endowment policies
Discussion
Guys, if you are looking at transferring to a repayment mortgage from an endowment & are thinking of of cashing in the policy, let me know, as i may be able help.
I'm the director of an IFA( independant financial advisers) practice based in Guernsey, & are very familiar with the traded endowment market & know who to use/avoid depending on the type of policy.
If anyone who has/is converting needs mortgage life assurance/criticall illness cover, like wise get in touch, as i'm one of the Directors, I can offer flexibility in pricing/or cashback on these type of policies.
E-mail: Darreniles@aol.com
Office: 01481 726672
Mobile: 07989 3007689
Sorry for the plug Ted.
I'm the director of an IFA( independant financial advisers) practice based in Guernsey, & are very familiar with the traded endowment market & know who to use/avoid depending on the type of policy.
If anyone who has/is converting needs mortgage life assurance/criticall illness cover, like wise get in touch, as i'm one of the Directors, I can offer flexibility in pricing/or cashback on these type of policies.
E-mail: Darreniles@aol.com
Office: 01481 726672
Mobile: 07989 3007689
Sorry for the plug Ted.
Anyone here sold or cashed in endowment policies before? I have recently changed my morgage, and am wondering what the best thing to do with 2 policies I have? I have heard some companies will buy them off me and give me more than the value if I cashed them in. Can anyone comment?
Yes
Get good advice
Try the Financial Services Authority website for a starter
e.g.www.fsa.gov.uk/consumer/whats_new/endowments/mn_trading.html
Companies who might consider "Traded Endowments" include:
www.bealedobie.co.uk
www.foster-and-cranfield.co.uk
www.neville-james.co.uk
www.policyplus.com
www.policyportfolio.co.uk
www.surrendalink.co.uk
www.aap.co.uk
a mine of useless information..............
www.bealedobie.co.uk
www.foster-and-cranfield.co.uk
www.neville-james.co.uk
www.policyplus.com
www.policyportfolio.co.uk
www.surrendalink.co.uk
www.aap.co.uk
a mine of useless information..............
For those with Unit-Linked policies ( read stockmarket based) remember that although the returns may look poor over the last 3-4 years, beacuse the unit price has been falling & you have been contributing monthly, you have been buying the units at a lower price.
When the markets rise ( as they will, just when) the policy growth will be exaggerated as the units were purchased so cheaply originally.
More important is to compare the policy with the peer group & compare policy charges/fees, as these can make a massive difference over the long term.
As far as selling is concerned, the general criteria is:
Must have been in force for at least 7 years.
Minimum surrender value of £3,500.
Unit linked policies (as opposed to traditional with profits/unitised with profits) are harder to find a buyer for, but there are buyers out there.
The insurer can also be a major factor when selling - needless to say no-one will bite your hand off to buy an Equitable life policy!
Darren.
When the markets rise ( as they will, just when) the policy growth will be exaggerated as the units were purchased so cheaply originally.
More important is to compare the policy with the peer group & compare policy charges/fees, as these can make a massive difference over the long term.
As far as selling is concerned, the general criteria is:
Must have been in force for at least 7 years.
Minimum surrender value of £3,500.
Unit linked policies (as opposed to traditional with profits/unitised with profits) are harder to find a buyer for, but there are buyers out there.
The insurer can also be a major factor when selling - needless to say no-one will bite your hand off to buy an Equitable life policy!
Darren.
I cashed mine in last year. It was only 4 years old so no one would buy it off me,most would over 5 years old.
It worked out that i lost a few hundred quid compare what i had paid into it.
I thought about Keeping it going but then decided that i live for now and have a decent pension to sort me out in the future.
The money i saved have since paid for new windows for the house and helped pay for my Griffith and Holidays.
Personally i would cash in unless you dont miss it what so ever and enjoy your little lump some and no more payments each month.
Oh year the other reason was they also predicated that mine was behind schedule buy about 15k so i took out repayment.
BB
It worked out that i lost a few hundred quid compare what i had paid into it.
I thought about Keeping it going but then decided that i live for now and have a decent pension to sort me out in the future.
The money i saved have since paid for new windows for the house and helped pay for my Griffith and Holidays.
Personally i would cash in unless you dont miss it what so ever and enjoy your little lump some and no more payments each month.
Oh year the other reason was they also predicated that mine was behind schedule buy about 15k so i took out repayment.
BB
I have one that I've had 10 years, the house is long gone. My accountant reckoned the best policy was to continue with it so I have.
Things got a bit tight recently and I was offered roughly what I paid into it which is ok. I'm going to carry on with it as I'm not relying on it to pay off anything like a mortgage and it must be a reasonable return or companies wouldn't want to buy them from you...
Mark
Things got a bit tight recently and I was offered roughly what I paid into it which is ok. I'm going to carry on with it as I'm not relying on it to pay off anything like a mortgage and it must be a reasonable return or companies wouldn't want to buy them from you...
Mark
beano1197 said:
Yes
Get good advice
Try the Financial Services Authority website for a starter
I've been there with the FSA route when I complained I had been given bad advice regarding my endowments - and got nowhere. Basically, when the statements started coming through saying there may be a potential shortfall in my endowments, I phoned my 'financial adviser' - the guy that sold me the policies, and asked him what I should do, as I wasn't keen on increasing the payments I was making. He said there was nothing to worry about, as the companies had to lower the projection figures used in estimating final values for these policies to reflect the lowering interest rates. Also, policies were still performing above this, and there was really nothing to worry about. What he didn't remind me of was the smallprint in my policy stating I should vary payments according to their recommendations to guarantee covering my final loan value. This was denied flatly by the salesman concerned, and the FSA said the burden of proof was with me to substantiate the contents of a 5 year old telephone call! I am consequently left with a possible £10k shortfall and no comeback. The only good (obvious) advice the FSA give is 'make sure you can pay off your mortgage when it is due by whatever means it takes' Which is why I am changing from an endowment to a repayment one - and looking for the best deal for my endowments (more wedge to spend on the Wedge).
DavidP said:
Ah that'll be pound cost averaging then
Didn't want to be a smart-arse (but then I was born that way
) - all a bit of a myth really, the benefits of pound cost averaging, by some accounts. Anyway the best invetment has to be a nice little safe TVR - risk rating "Adventurous" and yet some returns ARE guaranteed
. What's the good of £££s when you can have s instead? Since I am not charging for this advice, please be aware that you can't sue me if it turns out to be bad.
I'd recommend that you consider just keeping it running. If you are going to cash it in, but are intending to start saving soon anyway, then you can just use it as an investment. Surrender values aren't very good, and if you can afford to keep it going, you should end up with a useful sum of money at the end.
For those repeating the mantra of "stocks always go up in the long run", well yes, they TEND to, but look at japan. Nikkei has declined for the last twelve years. Down from 32,000 in 1990, to 8,500 now. In the long run, we're all dead, so you can't just keep waiting and waiting. The risks are real. Invest only what you can afford to lose.
I'd recommend that you consider just keeping it running. If you are going to cash it in, but are intending to start saving soon anyway, then you can just use it as an investment. Surrender values aren't very good, and if you can afford to keep it going, you should end up with a useful sum of money at the end.
For those repeating the mantra of "stocks always go up in the long run", well yes, they TEND to, but look at japan. Nikkei has declined for the last twelve years. Down from 32,000 in 1990, to 8,500 now. In the long run, we're all dead, so you can't just keep waiting and waiting. The risks are real. Invest only what you can afford to lose.
Remember that Endowment policies also carry an element of life cover, which obviously constitutes part of the monthly premium. I understood that it can be quite a large proportion, say 50%.
Therefore if you no longer have the mortgage to which the endowment was attached, then you're paying over the odds for unrequired life cover.
I would not continue with an endowment if my mortgage was either repaid or converted to a repayment.
Therefore if you no longer have the mortgage to which the endowment was attached, then you're paying over the odds for unrequired life cover.
I would not continue with an endowment if my mortgage was either repaid or converted to a repayment.
beano1197 said: Companies who might consider "Traded Endowments" include:
www.bealedobie.co.uk
www.foster-and-cranfield.co.uk
www.neville-james.co.uk
www.policyplus.com
www.policyportfolio.co.uk
www.surrendalink.co.uk
www.aap.co.uk
a mine of useless information..............
Post-new-year-update...
I had been thinking of surrendering or selling my endowment policy for a while, so I followed up on getting a surrender value and getting a 'free valuation' from all the companies above.
Not one of them was willing to make an offer. Only one of them actually gave any reason, and was basically saying that the current exceptional investment conditions precluded them from trading in any more endowments.
So its back to surrender value, paying up the policy, or keep going...
Edited to say: PI = Professional Indemnity
>> Edited by Size Nine Elm on Friday 10th January 10:08
petercam said: when I complained I had been given bad advice regarding my endowments - and got nowhere. Basically, when the statements started coming through saying there may be a potential shortfall in my endowments.
Lots of people like this on the news at the moment, with lots of violins in the back ground, what they never mention is that the value of the property most people purchased with low cost endowments is now worth far more than anyone could have expected.
Ok so the endowment was not a great investement but the house was so swings and rounderabouts, except they are now paying compensation for the bad performance of the endowment, and guess who is paying that, well me and everyone else on here who owns shares in insurance companies either directly or though a pension plan. Now is that fair.
PetrolTed said: I received a bit of advice from someone in passing, that I should wait until my policy has run for at least ten years as there's a tax advantage. Anyone know about this?
I think the life cover part of an endowment acts as an insurance policy, means any payout is free of tax, as opposed to a savings plan, and I suspect the ten-year thing is a qualifying part of that.
Edited to add: Google strikes again...
"Provided the policy was originally for a term of ten years or more and premiums have been paid for more than 7.5 years, then the proceeds of the policy are tax free in the hands of the policyholder."
>> Edited by Size Nine Elm on Friday 10th January 11:50
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