things that make you go ARRRG!
just chat amongst yourselves whilst I rant now will you? Today is not being as nice as it should be. i mean, the sun is shining, the sky is blue, the birdies are tweeting….. and I am in a foul temper.
In the post this morning I got a letter from the company that I hve my endowment plan with. This plan was taken out to pay off £25k when i bought my first house and was transfered over to our new one meaning that when it matures in 10 years from now we will hve a significantly lower mortgage and so be in a much better position to pay for things like Aprilia going to Uni etc. Currently I am paying £34 per month into it, £4 of which is "administration charges" I’ve just got a letter today saying that there is going to be a serious shortfall and that in order to get anywhere near £25k I need to raise my payments just a little bit….. to £100 a month. WTF???? If I do that I will have paid in £18k over the course of the endowment meaning that it will have only earned me £7k which I could have saved and then some in not having paid so much interest on our **** interest only mortgage if I had been paying that extra into it every month. Of course, i don’t have a valid claim against them as the orgininal paperwork had that bland "investments may go down as well as up" which the bint who sold me the policy said not to worry about, it’s just a legal thing, endowments ALWAYS pay out more than the projected figure. But that wasn’t in writing so I have no claim. 
And then i opened the next letter. My Red Cross "pay slip". Now, you may remember they cocked up the other month and paid my wage to someone else. Well, last month I therefore got 2 month’s worth of pay processed as if it had all been earned in 1 month and that tipped me over into needing to pay NI (if you earn under a certain amount each month you don’t pay NI) So this month guess what? All I got was my "holiday pay" - they have to pay you some nominal amount per hour that you work which they add on every 3 months. No sign of the 2 full days that I worked anywhere. Which means next month I will end up paying another £8 Ni again and that’s before we factor in loss of interest as the money isn’t in my account 
And I cna’t find a cheque book with an cheques in, found 3 empty ones lying round but non with any in.
and the little s**ts round here have trashed the play park again
and I am fed up with the kids next door playing football against my wall, over my front garden and round my car.
bah humbug!
do not get me started on incompetents and money right now…
Comment by jax — April 14, 2007 @ 6:21 pm
Is that the first letter you’ve had about an endowment shortfall then? We’ve been getting them for a few years now.
Comment by Joanna — April 14, 2007 @ 8:56 pm
WEll yes, Joanna, they have sent plenty of letters (roughly 1 a year for the last 10 years) saying there will be a minor risk of shortfall but don’t worry, it won’t be much. Now suddenly it’s a “SERIOUS RISK OF SHORTFALL” (written in red ink just to be sure it scares the bejesus out of you) and want to rack up the premiums to 3 times what they were. Then they have the gall to tell me that they are increasing the monthly admin charge to £4…..
Comment by Administrator — April 14, 2007 @ 11:22 pm
I should get some financial advice and instead of putting money into their endowment see if you can set up an ISA or whatever they are called these days that will give you a better return.
We hardly have anything to cover our interest only mortgage; we’ve got a savings plan via work and are relying on paying in lump sums of anything we scrap together. No pressure then! (£174,000 to go!)
Comment by Merry — April 15, 2007 @ 9:24 am
if this is the first red, I would still pop in a complaint. the going down and up is not the only thing that can mean you were missold - but was it a suitable plan for you. ie it is better if you are a 40% taxpayer than normal rate, and pretty useless if you don’t pay tax?
bbut yes, consider an ISA.
on the admin charge, that is a huge percentage of premium, so I would complain about that, and take it to the relevent ombudsman too.
but it is woth paying for financial advice at this point. [or at the minimum, seeing the CAB.
we have a 70,000 endowment from the first house, but as that is so crap, the remaineder of the mortgage for this house is on repayment.
Comment by HelenHaricot — April 15, 2007 @ 10:02 am
Merry, you are right, I need to deal properly with this, NO WAY am I in a postition to pay 3 times as much for the luxury of only “earning” an extra £7k over what I’ve paid them - it’s less than the 6% I could earn in a high interest account…
HElen, the FSA grounds for complaint are not all that generous, i would pretty much have to have it in writing that I was definitely going to get the right money for the policy to claim, I took it out when I was working and for a different house (although it’s not linked to that house any more obviously) so they could argue that it was a good deal at the time. I’ll see what the CAB has to say though. We are going to look at complaining bout Duke’s policy though, it’s set to run until he is 75!!!! They are not supposed to allow policies that go past retirement age without documenting how you are going to pay for it! (but then that is with the Perl who i wouldn’t trust DD’s pocket money with…)
Comment by Administrator — April 15, 2007 @ 10:16 am
We managed to claim misselling of our endowment and got the whole £11K we’d payed in over the years back. It was lengthy and required the tenacity to keep writing to them and about 2 years of waiting for their ‘investigation’ but it was basically done on the strength of me insisting the risks had not been made as clear to us as they should have been.
). I took the opinion that we had nothing to lose other than my own time and everything to gain, which indeed we did with a very large cheque at the end of it. Of course how we frittered that money away is another story but I’d definitely pursue it if I were you.
I wrote an initial letter and then they sent back forms requesting lots of supporting information. Plenty of it I refused to give as I felt it was irrelevant to them what our overall financial situation was at the time (bleak as it happened! I worried they might use that to gague that we had made consistently poor financial judgements and blame it on us, although I wonder if we’d shown examples of a strong overall position like a lottery win if they’d have felt we didn’t need their money too
Comment by Nic — April 15, 2007 @ 5:22 pm
I used to work as a financial adviser during the period when endowment mortgages were still being sold.
I don’t believe there was ever an occasion when an endowment mortgage was the right advice for anyone - it may be that there is a circumstance under which it would be, but I certainly can’t think of one. The only reason they were sold is because greedy insurance companies paid lots of commission on them so that they could rip people off for the life of the policy.
Do go to the CAB. Don’t throw good money after bad.
Comment by Anon — April 15, 2007 @ 5:36 pm
Hmmm, this is making me think maybe we really should try and make a claim - it was just DH at the time and he’s very pessimistic about such things though. But maybe….
Comment by Joanna — April 15, 2007 @ 7:28 pm