Scot Equitable Endowment. A little help please.

Kez100

We have a Scot Eq under performing endowment - now with AEGON. With profits fund set up to pay out 53k likely to be 20k too little.

I've been trying to suss out where we stand as IFA advice is stick with it and overpay mortgage - weren't you lucky to have had so many years of low interest to do that in.

The units do have an agreed 1 pound each at maturity but I assume the company have built that into their red letter advice.

I have found the following :

http://www.aegonse.co.uk/consumer/funds/1000.htm

If you could read the WPC fund sheet can you shed some light on what the numbers mean please. Looks to me like nothing much is happening and the terminal bonuses (on the final pages) have gone (or does, when it says Terminal Bonus Investment Date, mean when we started the policy - 1993)

Our mortgage interest rate is 0.6 of a percent above base. No tie in - offset flexi mortgage. Due to be repaid in 2016.

Any informed thoughts?

EdInvestor

The policy has a guaranteed growth rate of 3.9 per cent.The terminal bonus has gone and with less than 20% in equities it's unlikely to return.However the guaranteed return plus the free life cover means the policy may be worth keeping.

Can you post some more details so we can see.

Guaranted sum assured
Total added reversionary bonueses
Surrender value
Monthly premium
Maturity date

Kez100

I will llok out the detail. Can you help advise me where I can find the following or do I need to ask Scot Eq (Aegon) :

Guaranted sum assured
Total added reversionary bonueses
Surrender value

EdInvestor

Kez100 wrote: »

Guaranted sum assured
Total added reversionary bonueses

On annual statement

Surrender value

Ring up and ask.

Kez100

Ta. I don't get an annual statement! I do get them every few years but always off my own back after asking. I will ask for an up to date statement too.

Kez100

The answers ;

Guaranted sum assured 52,250
Total added reversionary bonueses None - unit linked policy
Surrender value 18272.12
Monthly premium 83.20
Maturity date April 2016

Apparantly I can switch the funds I invest in without losing the pound a unit guarantee and I am being sent details of them together with details of what I invest in at the moment which would have been dealt with by IFA when I bought the policy but has never been reviewed.

Thanks for your time

EdInvestor

If you stick with the endowment to maturity you should get 36,500, possibly a bit more, as there may be a penalty for early surrender.It's very unlikely any TB will arise, but this return is pretty well guaranteed.

If you cashed the policy in and used it to reduce your mortgage owed, plus overpaying with the premiums, then your return would be 43,808, assuming mortgage interest rates remain the same, less if they fall, more if they rise and this is also a risk free return.

If you needed to replace the life cover you should deduct the cost of that off the latter return. This policy might be valuable for someone with health issues, but if that's not the case, there seems little point in foregoing the better return you would get by reducing the mortgage.

Kez100

Cheers, I need to do some serious quote work on the life assuarce cover it seems.

Kez100

Your help is very much appreciated.