Endowment rip off?

cornishcream

Ten years ago i took out a "with profits" endowment policy paying £9.78 a month. I have just received notification that this is to mature immediately paying out £1213.71 over the past 10 yeras i have paid in £1173.60 thus making a profit of £40.11 for a 10 year investment!!
Any comments suggestions would be appreciated.

dunstonh

Comments: This type of plan is long obsolete (although a few still issue this style policy - crazily). Just be pleased you havent commenced one recently.

Much of the problem is likely due to the low premium. I am going to assume its an industrial branch style policy with that sort of premium and often with those plans there was a fixed policy fee, regardless of whether you paid in £10 or £20. This made the low premium versions quite poor value for money. In the past, high inflation and high returns hid the high charges.

Suggestions: Dont do one of these again and be thankful modern plans are much more cost efficient.

cornishcream

Thanks for your comments, the policy was with CIS, I took out 4 in total of the past 33 years they all matured on my various children's 17th birthday, the idea being to help pay for driving lessons/ car purchase, the other 3 did fairly well. You can guess what my youngest is saying!! I presume i have no "comeback" on this meagre pittance promised. On a lighter note you will all be pleased to know the CIS have sent me a beautiful glossy brochure entitlesd "How to reinvest your money with us" the brochure propably cost more to produce than our profit. I won't even start on our endowment mortgage taken out in 1991!!