Endowment Questions.... Sell or not

Gezzerboy_2

I have the following Setup

Total Amount Remaining 134325.53I
nterest Only 73000
Repayment 61325

Now Have a £135000 Mortgage with FD at 4.99 for 5yrs. With 18yrs left.

I also have a Standard Life Endowment Which I took out to cover £60k Back in June 1994 so I have 11 yrs left on it. The question is should I sell it now and pay off the mort or keep it ?

Current Total Surrender Value £17993 Inc final bonus
My premium is £86.60
Predictions by Standard Life
Low Growth - 335500
Medium Growth - £41700
High Groth - £49000

So even at the highest rate i have a £11k shortfall.

Not sure if i need to give the guru's on here anymore info ?

dunstonh

First thing to realise is that those figures are not predictions. They are projections using example rates. Rates which may or may not reflect the true performance of the investment funds being used.

What rates have SL used on your projections (low, medium high doesnt go far enough).

Is the final bonus included in the projections?
Is there a mortgage promise value?
what is cost of replacement life cover?

Gezzerboy_2

Ok the Rates are

Lower Rate 4%
Medium Rate 6%
High Rate 8%


Replacement life cover is only about £7 per month
My minimum guarentee is £35000
I dont think the quotes include the Final bonus

Gezzerboy_2

any update on this guys. Sell or Keep what do you think

EdInvestor

Gezzerboy wrote: »

Low Growth - 335500
Medium Growth - £41700
High Groth - £49000

If you surrendered it and used the lump sum to reduce the mortgage, also increasing the monthly mortgage payment by the amount of the redundant endowment premium to maturity your return would be 45,423.

This is significantly higher than the medium growth projection so I would dump it as there is no premium now for taking a risk.

You may wish to see if you can get more for it from the TEP traders at https://www.apmm.org