What to do with these... help!

tattercoats · Post by **tattercoats** » 05 Jan 2008, 10:50

Hello, hive mind...

We have this endowment policy kicking around from years ago. It matures in four years. Once upon a time the gamble was whether it would grow a bit or a lot - heh, folk used to use them to gamble on whether or not they'd be able to pay off their mortgages at the end of the term, can you believe it?

Now, of course, the gamble is a little different. As a dyed-in-the-wool doomer of this parish, I view the gamble as 'whether or not the whole financial house of cards - what Kunstler calls 'the Hallucinated economy - ihas come tumbling down in the next four years.'

Personally, I'm for looking into surrender values, or even sale values, and considering all options. My more cautious OH is a little more for the status quo, and therefore I am dispatched to investigate.

I suppos the question comes down to, how many years do you think the house of cards will stand?

If less than 5 (allowing for admin, delays, and the slow slide of the markets towards oblivion) then I'd sell them now, if only to get back what was put in.

I'd appreciate any comments you good folk in PS-land can offer. Thank you!

biffvernon · Post by **biffvernon** » 05 Jan 2008, 11:33

I've got one too, a legacy from the silly days, that matures in five years. I'm not counting on it for anything but gambling that the system will hold together for at least five years so I'm keeping it.

hardworkinghippy · Post by **hardworkinghippy** » 05 Jan 2008, 13:05

Mine "matures" in 2011. I've already cashed in everything else, so it's the only thing I have left in the UK.

The best resell price I was quoted was disappointingly low so I thought I'd take the chance, leave it and see what happens.

Let's hope things go slowly, not just for our cash of course...

Bandidoz · Post by **Bandidoz** » 05 Jan 2008, 14:09

Personally I think the economy will muddle through in 2008, and will begin to unravel some time in 2009.

Vortex · Post by **Vortex** » 05 Jan 2008, 14:33

Don't forget that humans tend to overestimate any changes in the next five years, and underestimate change after the five year point.

rabbit_hop · Post by **rabbit_hop** » 05 Jan 2008, 19:08

Good post Tattercoats - I'm interested in this thread because I'm in a similar situation.

I took out an endowment in 1991 when I bought my first flat, because I was told that it would easily pay off my ?36K mortgage - them were t'days - when it matured. As it happens, I paid off the mortgage early, but kept the policy going so that there'd be a wee sum to collect at the end. (Stop laughing at the back there.)

Just before the end of December 2007 I had the "red letter" which explained that even if things go remarkably well between now and 2016 I might get back half to two-thirds, say ?22K if I'm lucky.

But: even if the financial armageddon doesn't happen, what will ?22K be worth by 2016? Having read the posts on this and other sites (TOD, peakoil.com and HPC) over the last 12 months, I'm not confident that the financial system AWKI will even exist by then - so it's a question of whether it's worth continuing to pump ?50 a month into this, or just taking whatever money I can now and run.

I'm tempted to surrender the policy, or sell it on, which I think you can do - any ideas appreciated!

Ta.

RogerCO · Post by **RogerCO** » 05 Jan 2008, 19:27

Gosh, in a odd bit of synchronicity we had exactly this conversation this morning about our maturing in 2012 (taken out in 1987) notionally ?42k endowment with a current projected maturity value of around ?28k.
Showed the SO 'Crude Awakening' over the holiday and she is begining to 'get it'.
We pay ?65pcm - which means by maturity we will have paid in a little over ?19k. We have managed to decouple it from any debt/mortgage now so we can do what we like with it.
We agreed to investigate surrender and resale options, but our current favourite bet is to borrow interest-only against and spend it on energy independence measures for the house (solar thermal & pv, plus possible ground source heat pump) on the basis that if the whole house of cards comes crashing down the debt will be insignificant.

I'd be very interested to hear other ideas as I am VERY nervous about getting back into the debt treadmill...

Post by **kenneal - lagger** » 07 Jan 2008, 04:05

RogerCO wrote:(..... plus possible ground source heat pump) on the basis that if the whole house of cards comes crashing down the debt will be insignificant.

If the whole house of cards comes crashing down the electricity supply could well come with it. On the other hand the whole electricity supply WILL come crashing down with current reinvestment trends, bringing the economy with it. Electrically powered ground source heat pumps won't be much cop either way.