Impact on endowment

helenmcmullan

Hi all

my endowment is due to mature next year and currently even on the lowest prediction I’m in credit. With the Bank of England rate being so low will it affect the final sum?

just worried in case there will now potentially be a short fall!!!

Thrugelmir

Is your policy unit linked or with profit? 

Old_Lifer

As Thrugelmir says,  you need to say which kind of endowment you have. 

If you go back a page on this Mortgage & Endowment board, we had a similar thread yesterday  and other threads expressing similar  endowment concerns  on the Savings & Investment board  in the last two weeks or so.   If you scroll back 9 or 10 pages  on both boards you will find these threads which may be of help to you.

langers23

We received a letter on 17th February 2020 from Legal and General advising our flexible mortgage plan was maturing on 24th March 2020. It enclosed a predicted forecast of the value of our investment upon maturity.  This forecast showed us that we would be able to pay what we owed.  We have received our final payment into our bank today and in the space of one month the plan has decreased by £7,000.  Is there any financial compensation that we would be entitled to.
Thanks 

Thrugelmir

Unfortunately the key word is "forecast". Everybody is taking a financial hit in one form or another at the current time. 

dunstonh

his forecast showed us that we would be able to pay what we owed. 

It is not a forecast.   It is a projection.   Forecasts are something that are likely to happen.  Projections are something that could happen using a range of assumptions.

 Is there any financial compensation that we would be entitled to.

No.   You get the value at maturity, whatever that will be.       

If your plan was unit linked, then you should have been de-risking the investments over the last few years.  If you didn't do this (or employ an adviser to do it for you) then you have to accept both the ups and downs that go with investing.

Investors do not get compensation for negative periods. That would be bizarre and wrong.

Old_Lifer

Sadly no. 

   

If it is a unit-linked policy it would be worth whatever is the value of the units on the day of maturity.

If it is a  with-profits policy the policy will  usually say something like    'we may pay a terminal bonus at maturity or on death during the term'   (no mention of paying one at any other time.)     Although  terminal bonus rates  can be altered  at any time,   a reduction at this time of year is not unusual,  since most Life Officies set  new terminal bonus rates at the year end  and apply these new rates early in the coming year.   If your policy is with-profits , the reduction is probably due to new lower rates of terminal bonus being introduced shortly before your policy matured.