We’ve talked about the importance of smart financial planning in previous posts but today we wanted to share a story about the positive impact financial planning has had on the lives of two of our clients. By telling their story, we hope we’ll be able to help you with concerns you may be having about your own financial wellbeing and the way you plan for the future.
Martin and Helen are clients we took on from a retiring financial adviser around 3 years ago. At the time, Martin was in senior management at a local university and, at 59, was beginning to think about retirement. Helen is a 53 year-old self-employed artist and designer based in Brighton and though they weren’t thinking about retiring at the time they first came to us, they did want to have a better understanding of the pension and investment arrangements they had made with their previous financial advisor so they could properly plan for their future.
As is often the case, Helen and Martin were prompted to come in based on their circumstances. At the time, Martin’s employer was going through the latest of many company restructures and, as the saying goes, “The best time to start thinking about retirement is before the boss does.” Martin took this opportunity to visit us and weigh his options. He confided that he was ready to leave his job, but he and Helen needed to make sure that leaving was financially possible. Could they afford for Martin to stop working and still be able to live the life they dreamed of?
After they came to see us, we spent a great deal of time analysing their arrangements and we built projections to show them what level of spending they could support in the future. Martin was lucky to have an excellent final salary pension through his work which would form the basis of his retirement income. But what about the rest? Could they afford the niceties in life? Would they be able to eat out, take holidays, and maintain the standard of living they had grown accustomed to?
In our projections, we worked out how much, if any, tax-free cash they should take from Martin’s work pension. We also did some restructuring of our own and better aligned their investments with their risk profile to reduce their costs. As Martin is still young and has a lot of knowledge to share, he decided to take on some consultancy work three days a week. This flexibility allows them to spend plenty of time together while still bringing in an income. Helen is also looking toward a bright future and has decided to develop her business, too. They are choosing to do these things not because they need to, but because they want to. And because they feel comfortable and confident with their financial arrangements, they are able to live a life that is enjoyable and fruitful for both of them.
They are now in a great place and feel assured that their hard-earned capital will be sufficient to support their current lifestyle, as well as their future lifestyle, without them having to take undue risk. Though we can’t predict the future, we know that things will happen along the way that may impact their current arrangements, but when those things arise, we can adapt their plans to cope with any hurdles that may stand in their way. As we’ve seen over and over through the years, what seemed logical 10 years ago (or even three weeks ago!) may no longer be suitable, so regularly reviewing things and changing track when necessary will be vital for Helen and Martin just as it’s vital for all of us who want to maintain financial security in the future. Remember, when you build a plan and navigate to stay on course, you’re much more likely to end up at your desired destination!
We’re so thankful to Helen and Martin for being kind enough to let us share their experience. It’s a great honour to be able to help our clients achieve their dreams and we’re so glad we get to do it for a living!