Olibeneli

OK here goes.

I got 2 Standard Life with profits endowments. I have started ball rolling to complain about mis-selling.......see what they offer. (Had great success doing this with piss-poor Woolwich plan......got my money back and more besides even though had to convert this part of my mortgage to repayment which is more expensive monthly)

They are worth (surrender value + total bonuses) about £26,000 and I am waiting to see what I can sell these for via one of those people that buy such policies. I am thinking it's going to be more than this £26,000....which is a nice starter to fund the move, pay off existing debts, etc

I could wait until next year when Std Life float and get some freebie shares and then sell them.........probably makes sense come to think about it now...but when are they going public ?.

Also,,,,,,I could sit tight and continue to pay premiums for next 8 years when they mature in 2014.....costs me £70 per month (total costs to be paid to maturity around £6700-£7000). But I will be in Oz in one years time (max) and need to fund that £70 per month from Oz money and gamble on exchange rate for next 8 years.

Our "dream goal" is to release about £200,000 of equity from selling our UK house and buy something in Oz for about $500k and have little mortgage, therefore not needing the Uk endowment as a savings plan but better to save in a Oz based plan.

So, anyone else in similar boat? Questions I have are:

Would you sell these policies now given above information
Would you try and hold tight on to them and pay them from Oz......what are tax implications though when they mature in 2014 ? as they will be investment held outside Oz?
Would you wait for the float and then sell......if so.....any cluse when they are floating ?

I need a financial advisor really, but knowing one of these guys really well I think I can find out more than they really know themselves by doing my own research, of which this posting is part.

Cheers

kirsty&al

To knock one bit out of the equation. These are treated as Foreign Investment Funds in Oz, along with Personal and Group pensions and any type of Term Life Assurance (i.e. the type that pays out if you survive).

If the total of your FIFs (including those of any family members) is greater than $50k then the increase in their surrender value, each year, is taxable (but they wont then be taxed when they pay out at the end).

Personally I would wait as long as you can, just in case you get the shares, and then cash them in before going to Oz.

A.

sid_s

There is another option where your policy becomes "paid up". You basically stop contributing but your policy keeps growing. I'm not sure how things like terminal bonuses are affected though, i think it depends on the individual policy.

bridiej

May be some useful info here:

http://forums.moneysavingexpert.com/...ad.html?t=4722

worzel

We are in a very similar situation, except for the bit about waiting for a possible windfall. We had two policies worth £7K and £13K. A quick search around the net indicated the smaller one (only 5 years old) would not attract a buyer so we just cashed it in. There was also a timing issue that we wanted to pay off car loans early so we can demonstrate cars are free of "incumberance" when we sell them. I have formed the impression that as a very rough guide policies over £10K and over 10 years have a good chance or realising more than cash value by selling them.

We have booked a financial adviser to see next week with regard to the other one to see whether he can sell it for any more than surrender value. We will also see if he has any suggestions with pensions, Cash ISA's, Post Office bonds etc etc at the same time.

As far as carrying on paying into it; obviously there are risks with the investment part but you should also check that any life cover element is not invalidated by living outside the UK. We have two other standard life policies which are ok (I made calls yesterday and we will carry them on) but it depends on the policy.

Bear in mind tax implications too as someone said.

Personally I am going to get rid of them one way or another just to simplify matters. This exercise has made us realise that we have little bits of money all over the place and we are having trouble sorting it out now. That would be even harder when we live on the other side of the world. It is also about the therapeutic exercise of "life laundry"

I hope that helps.

debilloyd

How much paperwork did you have to support your misselling on your endowment? We have about 5 endownments, all bar one is falling short of the project final amount so no way will we be able to pay off our mortgate once they mature. I've thought about complaining but not sure I have enough evidence to back it up. Would really appreciate some advice on how you went about it - PM me if you like

Debs

bridiej

Hi Debs

have a look at the link I posted, I'm sure it will be of help

Olibeneli

Your last point looks a good course of action. Thanks

Olibeneli

Life laundry............nail on the head I think. All this Oz stuff is making me have a real good clean out..........and not just of my financial affairs.

(Sorry for the queasy among us)

Olibeneli

From todays BBC website:

More than two million people with endowment mortgages are facing a shortfall, the Financial Services Authority (FSA) has said.
The average shortfall on an endowment policy is £7,200, the FSA added.

Nearly 70% of people facing a shortfall have already remortgaged, sought financial advice or have applied for compensation for mis-selling.

However, the FSA said that about 700,000 people have done nothing about their endowment shortfall.

Endowment mortgages were sold heavily in the 1980s.

Many people were told their endowments were guaranteed to pay off their mortgages but these promises have frequently fallen well short.

Increasingly, consumers have been seeking compensation for mis-selling from endowment mortgage providers.

Last month the Financial Ombudsman Service - which adjudicates on endowment mis-selling - revealed that it was receiving 1,300 complaints a week about endowment mortgages, 34% more than a year ago, and up from 300 a week three years ago.

sme

We did it and it wasn't too bad - lots of filling out of paperwork.
We also didn't have formal evidence but you have to complete a questionaire asking about your attitude to risk etc and they seemed to base it on that. Also bare in mind the co. that sold you the policy probably won't have evidence that they DID NOT miss sell you the policy.
Good luck
Gillian