question re: L&G flexible mortgage ISA option

22johnny22

As a first time visitor to this site, I have no doubt this discussion has been had before!! sorry if repeated!

I have a flexible mortgage plan isa option, which was started in March 1999, i am paying £115 a month to pay back 75000 gbp after 25 years.

As are most the plan is not performing as planned and we are likely to have a shortfall.

We are in the fortunate position to have paid off the mortgage recently and continuing to pay into the plan as a savings programme. recent correspondence from L&G suggests the shortfall can be covered by either making additional savings elsewhere or paying off some of the capital.

My questions are:

1. is it a worthwhile paying into the savings plan, it does provides life and critical illness for me and my partner (joint plan holder) which we need

2. I am told we cannot top up (increase) the payments directly into the plan.

I feel this is rather unfair as it is tying up our isa allowance every year and we are only jointly paying circa 1300 gbp per annum.

i appreciate we were told that the fund value may not be enough, but should the restriction on paying into our isa allowance have been disclosed?

Many thanks for your time and i look forward to your advise.

regards

22Johnny22

Lemoncurd

I also took out one of these in 1999, mine was supposed to be worth around £60,000 after 25 years.
The house was sold in 2000 so I've been keeping my plan as a savings plan as well. I've had loads of trouble getting any info out of L&G and the broker who sold the product is no longer authorised to advise on this type of investment but I was told that it was possible to make top up payments to make up the ISA allowance. In fact in one of the earlier years I was sent a letter from L&G near the end of the tax year suggesting that I do this. I'll try and dig it out later.
I no longer have the life assurance component but am still paying £100 a month so it sounds like you've got a better deal!

I haven't done much research into this (keep on meaning to do more) but am fairly happy with mine as a savings plan as I feel it isn't underperforming terribly in the current climate and it is early days yet only being 1/5 of the way into the term. Maybe someone else will have other ideas - I'd be interested to hear them as well.