MONEYBOX; LESLEY COLLINS, head of Independent Women Financial Advisers in Edinburgh and Glasgow, answers your queries.I HAVE a mortgage which has an outstanding balance of pounds 25,000 and I have recently inherited pounds 50,000. Should I pay off my mortgage - which will save money every month - and stop me worrying about my endowment, which will be short at the end of the term?
THERE are a number of ways of looking at your situation.
Although interest rates are low, you could invest the money, even in a fairly safe way, and this will give you capital growth.
Some of the interest accrued would help pay the mortgage costs but it is a bit of a gamble if your investment underperforms.
The other option, to repay the loan in full, will give you peace of mind and still leave pounds 25,000 to invest.
You could then use the money which you are saving from your mortgage each month to drip into an investment plan, for example, an ISA.
In addition, you will also have the endowment at maturity, to use in any way you wish.
I HAVE 500 Lloyds TSB Lloyds TSB Group plc (LSE: LLOY) is a banking and insurance group in the United Kingdom. It was formed in 1995 by the merger of Lloyds Bank and the Trustee Savings Bank (TSB). The Group's head office is at 25 Gresham Street, London. shares which I would like to sell. How do I go about this as the last time I sold some shares, the commission from the bank seemed very high?
FIRST, these shares have approximately halved halve
tr.v. halved, halv·ing, halves
1. To divide (something) into two equal portions or parts.
2. To lessen or reduce by half: halved the recipe to serve two.
3. in value in the last year and are currently standing at pounds 3.50 per share.
If you can afford to hold on to these, you may do better in the longer term. If not, there are lots of different ways you can sell. Check the internet, teletext teletext: see videotex.
A broadcasting service that transmits text to a TV set that has a teletext decoder. It uses the vertical blanking interval of the TV signal (black line between frames when vertical hold is not adjusted) to transmit about a hundred or Stocktrade as most will have set fees, from as low as pounds 10 per transaction.
I HAVE pounds 5000 and would like your advice on how best to invest it. I have two children, age 11 and 12 and would like to save this to go towards university costs. What do you suggest?
IF you are investing this yourself, then you could pay this to an ISA for this tax year, as at least the proceeds will be tax free.
Pick fairly low-risk graded funds to give you an element of safety.
A unit trust is also a good way to spread the money between a number of investment styles and managers.
MANY years ago, my mother took out an insurance policy which the bank accepted when we took out our mortgage. Part of the way through our mortgage loan, we changed to repayment. Now that our mortgage has been paid up we have been told by the insurance company that the policy never matures and runs on until my death. We were hopeful that we would get a cash sum now to help in our retirement. What do you suggest we do?
THIS is likely to be one of two types of policy. The first is a straightforward life policy which would give a lump sum Lump sum
A large one-time payment of money. on death.
This is normally for a fixed period or term and your mother would have been unlikely to stipulate stip·u·late 1
v. stip·u·lat·ed, stip·u·lat·ing, stip·u·lates
a. To lay down as a condition of an agreement; require by contract.
b. a specific number of years when she took it out.
The bank may have accepted this policy due to the death benefit but the most likely answer is that the policy was set up on a whole- of-life basis. This means that the policy never matures but a benefit is paid out eventually on death.
It may also have a surrender value surrender value
See cash surrender value. , particularly if it has been in force for a long time. Check with the insurance company and weigh up whether you need the money now or at a later stage.