Are you tired of paying for an endowment policy which you now
fear may never pay off your mortgage? Would you be better off walking
away? In this article I want to look at the options that people with the
once popular endowment policies now have.
Back in the 1980's endowment policies were seen as low-cost and low-risk ways of saving for your retirement. Unfortunately the reality has been a little different from that which was promised by the keen insurance agents who promoted the policies to British home-owners at the time.
An endowment policy is a combination of life insurance and stock investment all backed by a mortgage against your home. Typically the policy owner has an interest-only mortgage against the property and the capital is invested into managed funds or the stock market. The gains of the market were supposed to pay off the home mortgage at the end of the policy's term - usually 25 years.
Unfortunately the low interest rates and turbulent stock markets of the last couple of decades have exposed endowments as being high cost inflexible investments which few people would invest in today.
So if you are the unhappy owner of an endowment policy what are your options? Well you may have more than you realize. Most policy owners would only think of selling their policy back to the company that they bought it from. But when they find out how low the surrender value is they are usually disappointed and feel they have no option but to stay invested in the endowment.
Selling to the original company is not your only option though - there is a healthy second hand market of buyers who are prepared to buy your endowment policy. The easiest way to find these potential investors is to go through an on line endowment mortgage brokerage - these agents will take a cut from the price but you may still get substantially more than the surrender value of the policy with the original company.
Back in the 1980's endowment policies were seen as low-cost and low-risk ways of saving for your retirement. Unfortunately the reality has been a little different from that which was promised by the keen insurance agents who promoted the policies to British home-owners at the time.
An endowment policy is a combination of life insurance and stock investment all backed by a mortgage against your home. Typically the policy owner has an interest-only mortgage against the property and the capital is invested into managed funds or the stock market. The gains of the market were supposed to pay off the home mortgage at the end of the policy's term - usually 25 years.
Unfortunately the low interest rates and turbulent stock markets of the last couple of decades have exposed endowments as being high cost inflexible investments which few people would invest in today.
So if you are the unhappy owner of an endowment policy what are your options? Well you may have more than you realize. Most policy owners would only think of selling their policy back to the company that they bought it from. But when they find out how low the surrender value is they are usually disappointed and feel they have no option but to stay invested in the endowment.
Selling to the original company is not your only option though - there is a healthy second hand market of buyers who are prepared to buy your endowment policy. The easiest way to find these potential investors is to go through an on line endowment mortgage brokerage - these agents will take a cut from the price but you may still get substantially more than the surrender value of the policy with the original company.
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