PJ Media

How I Ended Up Broke at 55

Anyone looking at my blueprint for a happy life composed at 27 would think I was the wisest young woman in England. Indeed, when I was an executive with Anglia Television Drama at that relatively youthful age, colleagues would come to me for advice on long-term investment. I knew that behind my back they were making cracks about “Jews are always the best with money” but it did not faze me. I seemed to have planned for a prosperous future. Just before she died, when I was 35, my mother said, “I’m not worried about you. One day you are going to be a very wealthy woman.”

Well, I should have been. I am 55 and penniless. Without the generosity of friends I would be on the street.

What happened? In light of the daily stories on American news programs about tent cities and rampant foreclosures, I thought I would share my story. Here is the sorry scenario:

When I was in my 20s and an enormously ambitious television and theater practitioner, I knew I would need to organize a long-term financial scheme for myself should I not marry. I knew that life was hard for single women. So, at age 27 I began investing in the employee pension plan at Anglia Television. At age 30, after a protracted struggle to get a mortgage, I finally bought the flat I had been renting in St. John’s Wood; I took out an endowment plan with Friends Provident to guarantee my interest-only mortgage and give me an additional lump sum at term end, or so I was promised by the salesman. In 1991 my father and I decided to buy the flat above me and knock the two into a mews house. Just as we were about to sign the papers he had a massive stroke and I decided not to proceed on my own.

He lingered and died three years later. I decided to take some equity out of my flat and in turn to invest in a second endowment plan with Abbey National Life to supplement the Friends Provident one. Again, the salesman at Abbey National promised me a generous lump sum at the end of the term of the plan.

I left Anglia in 1991 and went freelance, taking out a private pension plan with NPI. It was a difficult existence and I struggled for many years, compounded by illness, but in the back of my mind was the voice of my late mother: “One day you are going to be a very rich woman.” For a while I earned a decent salary from the Dutch conglomerate JE Entertainment and gave a lot to charity and to less fortunate friends, but that ended when I stood my ground with JE over their unspeakable racism about my black secretary. (“If she sits on our chairs they will start to stink.”) I left and had a few lean years. Then came the 2000s: lo and behold, Friends Provident and Abbey National Life wrote to me and to millions of other investors saying there was a “substantial shortfall” in both endowment policies. Property prices were not high and I had no hope of selling my flat. In addition, as I neared my 50th birthday, I was told my Anglia pension, which had been moved by my IFA from Norwich Union to Scottish Equitable, had also “tanked.”

I appointed Brunel Franklin to challenge Friends Provident and Abbey National Life about the endowment shortfalls but lost both appeals. Here I was at 50 with useless endowments and a pension that was worth a fraction of what it was supposed to have been worth when I was given the projections in my 20s. Basically I was facing a life of misery and poverty.

In 2002 the Bank of Scotland (BOS) was offering a package in which one could take 5% of the value of one’s home out every year. No sooner had I moved to this product than BOS came in and down-valued my flat so I could not take out any equity. I need say no more. I battled with their Edinburgh office for two terrible years. My bank, HSBC, offered to move my mortgage to them and give me as much equity as possible, and indeed their institutional valuation was £340,000 in July 2007. They could not lend to me, because my income fell short of their criteria; despite the HSBC valuation and a smaller flat in my block selling for £325,000 in October 2007, the Edinburgh HBOS (a holding company for BOS) office still would not restore my value back to the £300s. They sent a valuer in and he said £220,000 — in the middle of the property boom! Jane Morrison at HBOS shouted down the phone at me: “Miss Gould, if you were the prime minister himself we would not adjust this figure.” I went to the ombudsman, who waited almost a year for the HBOS to reply, and indeed the Financial Services Authority was inclined to support my case, but my compensation was £500!

So, at age 55 I have no endowment funds to pay off my mortgage, let alone a “generous lump sum,” and my pension funds are pitiful. To top this all off, to compensate for the door to equity release in the London flat being shut, I sold my house in the U.S. for a song. I could soon be homeless in the UK as well.

Had anyone looked at my life at 30 they would have said I was the most prudent young woman around, but the thousands I have paid into endowments, pensions, mortgages, and insurance have gone to make those companies’ executives very rich and investors totally unrewarded. Do I, a right-winger, sound like a Marxist? Maybe. But my capitalist life has brought me nothing but anguish and the shame of begging from friends to pay basic bills.

When I see “Friends Provident” plastered all over sports grounds and hear their CEO in the financial pages saying they are “cash rich,” I feel sick. He is paid an obscene salary despite FP being a Quaker company. I mentioned this when I was a panelist on BBC’s Any Questions? and received supportive mail from other hard done-by citizens.

The sad fact is that through no fault of my own I am broke at 55. Hopefully my books will take off but unless I have the luck of J.K. Rowling I might indeed end up in tent city. What advice do I give my goddaughter? Perhaps mattress money is the answer.