Endowment Policies

[The Artful Shrimper]

With 14 years left on my mortgage am thinking of changing to a repayment which I can afford and cashing in the endowment policies. Anyone done this before? is it easy? can I sell the plans etc etc.

 

[Xàbia Shrimper]

Yep. I did. Although I was selling my place in the UK at the time so I supposed that might have helped. I simply rang the company concerned and said I wanted to sell my policy. They took things from there ...

WS

 

[Guest]

Go here for some useful advice (an excellent website)Money Saving Expert

 

[RobM.]

DO NOT CASH IN! You will lose huge terminal bonuses! Check your statements.

 

[Ron Manager]

Quote[/b] (RobM. @ Aug. 07 2005,12:43)]DO NOT CASH IN!  You will lose huge terminal bonuses! Check your statements.

I have to say most people who change to repayment mortgages keep the endowment on as an investment because of that exact reason, this is of course dependant on you being able to afford the higher mortgage repayments and the endoment policy payments. It all depends on your particular policy and personal circumstances, so before you commit to anything get some decent financial advice

 

[ESG]

Quote[/b] (The Artful Shrimper @ Aug. 06 2005,10:16)]With 14 years left on my mortgage am thinking of changing to a repayment which I can afford and cashing in the endowment policies. Anyone done this before? is it easy? can I sell the plans etc etc.

Are you expecting a shortfall on the policy at the end of the full term?

 

[Xàbia Shrimper]

Quote[/b] (RobM. @ Aug. 07 2005,13:43)]DO NOT CASH IN!  You will lose huge terminal bonuses! Check your statements.

erm ... I didn't. Was I lucky?

WS

 

[The Artful Shrimper]

Quote[/b] (RobM. @ Aug. 07 2005,12:43)]DO NOT CASH IN!  You will lose huge terminal bonuses! Check your statements.

We have two policies and we will get 8k each off them which is just about the amount we've invested and a little bit more. In fact my own personal shares have done better.
Can't really afford to keep the repayments and the endowment so theats not an option.
I also have a promise that the policies will reach the target from when I got the policy, of course, now they won't. I could argue with FSA which I will probably as that's why i'm cashing them in, I can't get penalised as we've had them for a while and because of the failure of Standard Life to play the markets we can cash them in and get 16k which is what we've been told on our last warning notice regarding not achieveing the right amount.
Will probably lump 10k of the mortgage and spend the rest on sweets and beer or something....

 

[Ron Manager]

Quote[/b] (Xàbia Shrimper @ Aug. 07 2005,13:24)]

Quote[/b] (RobM. @ Aug. 07 2005,13:43)]DO NOT CASH IN!  You will lose huge terminal bonuses! Check your statements.

erm ... I didn't. Was I lucky?

WS

Sort of....it all depends on the particular policy you have, how long you've had it etc etc...there's no real general rule to this, which is why you must get someone suitably qualified to look into it and give you the right advice (not touting for business, I don't deal with nor am I qualified to give advice about endowments).

 

[The Flying Scotsman]

I would PM "McNasty" as he works in this field and helped me change mortgages. Very helpful bloke too.

 

[Upminster Blue]

Quote[/b] (Xàbia Shrimper @ Aug. 07 2005,13:24)]

Quote[/b] (RobM. @ Aug. 07 2005,13:43)]DO NOT CASH IN!  You will lose huge terminal bonuses! Check your statements.

erm ... I didn't. Was I lucky?

WS

It all comes down to what you mean by "cashing-in". There are two possibilities:

- surrender your policy with your endowment provider. In this instance you will loose out on terminal bonuses due at the end of your policy and you will also be hit with exit charges. These loses are hard to identify and quantify in advance, not least becuase endowment providers tend to be very opaque with the information shown on statements etc; or

- sell your policy on to a third party endowment broker. Essentially, they take over the policy and typically give you more for the policy than under the surrender route, sometimes by as much as 30%+. They can afford to do this because as the policy is continuing the above surrender loses are not incurred. Have a look at the financial pages on teletext for some brokers.

Hope this helps.

 

[RobM.]

...or you could make it "paid up" i.e. you still have the policies but don't pay any more. Obviously the return will be lower.

 

[The Artful Shrimper]

Have looked at som,e brokers but they wopn't buy Standard life policies attached to the stock market with W references ? so I just take the surrender value and run I guess.

 

[Guest]

Did you check the link :

Endowment Mis-selling

 

[ESG]

We took out an endowment morgage for £50K with the Woolwich(now Barclay Life) in Early 1993. After the latest letter from Barlcay Life saying the projected shortfall after 25 years would be the best part of 25K we decided to complain about misselling of the policy.
Barclay Life have now offered to pay 15K made up of the 10k we've paid so far and another 5K of bonuses due to get rid of. We can now convert the remaing £35K to repayment,and although its going to he higher payments we've not got the £70 endowment a month and its all payed up in 12 years.

 

[Custard Splat]

Quote[/b] (The Artful Shrimper @ Aug. 07 2005,17:10)]I also have a promise that the policies will reach the target from when I got the policy, of course, now they won't. I could argue with FSA which I will probably.

Just a quick note... if you intend making a complaint about this, it is the Financial Ombudsman Service (FOS) that will deal with this, not the FSA. You will also need to complain to the selling agents first before the FOS can look at it. If you have any problems, drop me a PM (I work for the FOS and spend half of my life adjudcating on bloody endowment complaints!!)