How do i know if i was mis sold my endowment?

CarlyA

Hi there, i pay £55 to my endowmrnt each month and have done since it wa taken out with Halifax in 1998. I remember receiving a letter a while back saying that there was a possibility my endowment wouldn't cover the mortgage and so i should consider making extra payments or increase my monthly amount. i did neither. and i don't have the letter anymore. Can i simply write to the halifax and ask them if it looks like my endowment will fall short? Is it worth cashing in an endowment?

Appreciate any advice.

C.

FOSman

You can still increase your premiums if you want to, but you need to understand that the endowment is an investment that has life cover attached to is.

Therefore, you need the investment to grow properly to pay off the mortgage.

If you were not warned that there was a risk with the policy, which in my opinion would be highly unlikely in 1998, then you have grounds for a complaint.

dunstonh

I would have thought 1998 documentation on endowments would have been pretty good. Damned foolish advisor if it wasnt.

Also, you have to look at the way the shortfall is calculated: When the endowment is set up, it will have a target growth rate of around 7%p.a. Your projections are probably showing 4,5 & 6%. So its obviously going to show a shortfall. It doesnt mean there will be one. Indeed, I am assuming that you are with a unit linked endowment, you would benefit a lot from the stockmarket crash as you are buying those units over the last few years much cheaper. Having a stockmarket crash early on in the savings plan is highly beneficial over the long term. It gives you far greater potential for growth than if there had been no crash.