My Little C.I.S. Endowment...

EdInvestor

Financial_Novice wrote: »

However when it did actually mature it had earned an additional £6k of Terminal Bonus which is never quoted in projections because it is not guaranteed

TB is included in projections and surrender values these days.

Dick_here

EdInvestor wrote: »

That's a very respectable investment mix for a WP fund these days, so their projection of 5.75% does look reasonable.

But it still won't beat putting it in the bank.

If you cash it in and put it in an account earning 5% net of tax, also paying in the premiums to maturity, then you would end up with 2,359, compared with their forecast of 2,140.

But Ed, they've told me that a current maturity on this policy is actually paying out £2850 !

EdInvestor

!!!!!!_here wrote: »

But Ed, they've told me that a current maturity on this policy is actually paying out £2850 !

Yes, quite normal, maturity values on endowments have been falling for years. Last time I looked the only company with rising maturities was the Pru.

This is why it is sometimes better to surrender before maturity, even if maturity is only a short way off.You can lose out if you wait.

Dick_here

But that's still far better than I'd get using their forecast, and better than the £2359 you say I'd get by putting it into the bank. So why should I surrender ?