Having brain freeze! Should I cash in ISA Fund Plan?

Paperpumpkin

Would anyone mind casting an eye over my logic below to see if I'm way off course? I'm wondering whether to cash in my Synergy "Stocks and Shares ISA" plan but am struggling to make sense of the figures. Can anyone help?

I currently pay £120 a month and there are 113 months left until maturity - so I've approx £13 500 still to pay. Current estimate of current value is £34 000.

Estimates of value at maturity are £44 000 (at 5%); £55 000 (at 7%); £68 000 (at 9%). (The Synergy phone adviser said it's currently expected to make £67 000 at maturity, which surprises me, as previously it's been under-performing, so I'm not sure how reliable this expectation is).

However if I cash in now and get the £34 000, I can use this to pay off some of my mortgage, reducing monthly mortgage payments by £187, which equals approx £21 000 over the remaining 113 months of the Synergy plan.

So adding up the £13 500 (that i'd otherwise spend on future monthly Synergy payments) + £21 000 (mortgage payment saving) = £33 500. That looks like it's not worth my while cashing it in and I'd be better continuing to pay each month and hope to get a minimum of £44 000 in 2027. But I feel I may have missed something daft here. Have I??! Thanks so much for any sensible advice anyone can offer.

dimbo61

This is a Stocks and Shares ISA
It has No terminal bonus I Think so if it helps clear your debts that might be a good idea.
How well has the S&S ISA been so far ?

dunstonh

The Synergy phone adviser said it's currently expected to make £67 000 at maturity, which surprises me, as previously it's been under-performing, so I'm not sure how reliable this expectation is).

Synergy do not have any advisers. It states that on its website.

Its certainly not a great ISA but I am not sure why you think it is underperforming. Underperforming what?

Current estimate of current value is £34 000.

No estimate should exist. It is a unit linked fund ISA. So, it will have a daily value.

The projections actually seem a bit on the low side but that is not unexpected given current projection rates (which may not reflect reality).

Paperpumpkin

Thanks for your replies. Please bear with me - until a few weeks ago I had mistakenly thought this was an endowment policy, so I'm just trying to make sense of it now. I may have been inaccurate with my terminology - apologies. The "advisor" was the person who answered the phone when I rang Synergy for more info. The "estimate" was what she said I'd receive (approximately) if I cashed it in now.

So from your replies, am I right in thinking that this is basically a kind of savings account/policy, and there's no real benefit in holding on to it for then next 10 years (& paying £120 a month to do so)? Maybe I could cash it in, pay off a bit of my mortgage, and make the £120 work a bit harder for me?

Just don't want to make a really stupid mistake!

dimbo61

Well the top 100 company shares have been doing well over the last few months but how long will it last