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Endowment Bonuses?
Moneybug
Posts: 6 Forumite
I'm 19 years into a 25 year with profits endowment policy and looking to assess the risks attached and the value at maturity including bonuses.
However I am a little confused how the bonuses work, in particular when I rang the company they said that the investment had grown 5% in the last year. However looking at my statement, the annual bonuses say 0% and no mention of a 5% growth.
From my understanding there is a fund which is growing at approx 5%, but 5% of what? my total sum assured? and is this a compounded growth since the start of the policy?
They have sent me a projected figure of what it might reach on maturity at different percentages, the figure they give for 5.5% is approx £20,000, the current guaranteed amount is £10,000 minimum + £5,000 bonuses (£15,000).
It looks like after investing just under £3000 more in premiums till maturity it would only have £2000 total bonuses added in real terms (Bonuses - Premiums). The policy is £30,000 on death.
However I am a little confused how the bonuses work, in particular when I rang the company they said that the investment had grown 5% in the last year. However looking at my statement, the annual bonuses say 0% and no mention of a 5% growth.
From my understanding there is a fund which is growing at approx 5%, but 5% of what? my total sum assured? and is this a compounded growth since the start of the policy?
They have sent me a projected figure of what it might reach on maturity at different percentages, the figure they give for 5.5% is approx £20,000, the current guaranteed amount is £10,000 minimum + £5,000 bonuses (£15,000).
It looks like after investing just under £3000 more in premiums till maturity it would only have £2000 total bonuses added in real terms (Bonuses - Premiums). The policy is £30,000 on death.
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