Endowment Policies For Those Starting Out

by : Derek Both

Endowment policies can seem like a daunting prospect to those who have no idea what they are, what they do and how they work. As a result of this many people choose to live in ignorance about them and never enquire about them or find out what they really are. Whilst this might not bother the majority of people, many are often surprised to find that by choosing to ignore endowment policies means that they are missing out on some great investment opportunities.

Not only do endowment policies provide security but they are great investments for the future. The reason for this is because they are life assurance contracts which are designed to pay out a lump sum after a specified term. The amount of time you have your policy can range from 10 years to 15 years to even 20 years if you want.

This is the exact reason why so many people choose to invest in endowment policies. You put your money into something and then when you think you will need it in the future, say if you plan to retire and move abroad, and then the money is there for you. This gives you piece of mind that you have something to fall back on in the future even if something should go wrong financially before then.

Something that worries a lot of people who don't know the ins and outs of endowment policies is they think that once they have invested their money in them it is gone until the date you specified that you want the policy to end. This is by no means the case and you are free to surrender or sell your policy at any time.

Companies understand that things come up such as divorce, debt or even moving abroad and therefore make it fairly straightforward for customers to pass on their endowment policies if they wish to.

If you find yourself in the position of wanting to give up your policy early then you have a few options. You can either surrender the policy back to the company you bought it from in which case you will get your money back. Alternatively, if you are not in so much of a hurry and are willing to put in time and effort doing research, you can sell it to someone else. If you shop around you are bound to find a good deal that will make you a significant amount of money.