Selling With-Profit/Unit Linked endowment

Lexis200

Hi All

I have a Prudential (was Scot Am) Unitised With-Profit & Unit-Linked Funds endowment, bought in 1994 with my mortgage.

For various reasons, I no longer have the mortgage, but I do have debts, and I wondered if/how to sell the endowment to help with the debts.

I phoned one company who dealt in selling endownemts, but they said it had to be 100% With-Profits or they couldn't sell it.

Does anyone know of places that broker non 100% With-Profits policies, should I surrender it, or just keep trying to pay it until it matures (although my debts mean it's probably not a good idea to keep paying it).

Any thoughts appreciated!

dunstonh

You cannot sell unit linked funds. In your case, I cannot see you being able to sell it because it has to be all with profits.

Lexis200

Thanks for that.

I now have a surrender value from the Pru. It says

With Profits Fund (5 clusters) Surrender Value £4866.42
Investment Linked (5 clusters) Surrender Value £3888.25
Total Surrender Value £8754.67

The last premium was paid was 22nd June 2004 for £77.50 and the surrender value is based on the value on 18th July 2005.

My questions now are...

should I pay the premiums up to date (about £950 extra) and then surrender it, or should I just surrender it now?

If I pay the extra £950ish in, am I likely to get more than that back out, or less? Bear in mind that I HAVE to surrender it soon anyway because I can't keep the payments up any more and I don't need it as an endowment plan, and I'll have to borrow the money (from family so there's no interest on the loan).

I know that people can't give specific advise here, but a general rule of thumb would be very useful!

Cheers

Lexis200

I'm a bit desperate for an answer... anyone??

Just had another quote form them... as of today the surrender value is £8796. 58, so it's rising slowly... the With Profits fund has risen by £3, and the Investment Linked has risen by £30, both in a week...maybe that'll make a difference to whether I pay up the extra now now or just surrender?

Cheers

EdInvestor

Hi Lexis

Lexis200 wrote:

should I pay the premiums up to date (about £950 extra) and then surrender it, or should I just surrender it now?

If I pay the extra £950ish in, am I likely to get more than that back out, or less?

The answer to your question depends on what happens in the stockmarket between the time you pay in the extra money and surrender the policy.

I'm afraid anyone who knew the answer to that would be very unlikely to be posting on a Moneysaving bulletin board

What's your opinion? Do you think the market will go up or down in that period?

Depending on your view, act accordingly.

Lexis200

Thanks for the advise.

So you're saying that the extra money only "works" from the day it is paid into the policy rather than being added retrospectively? That's more of a statement rather than a question, but I'd be grateful for the clarification.

As I'm going to be surrendering the policy imminently, it doesn't seem worth the aggro to pay the extra, unless it's added retrospectively (as they're payment arrears).

EdInvestor

Lexis

Lexis200 wrote:

As I'm going to be surrendering the policy imminently, it doesn't seem worth the aggro to pay the extra, unless it's added retrospectively (as they're payment arrears).

Best to call up the Pru and ask them their policy on this and then act accordingly.