Case study: Financial advice means….living the life in retirement you deserve
Retiring from work can be daunting. The major life change can bring stress as well as benefits, but taking financial advice can mean living the life in retirement you deserve. Find out how Personal Wealth Adviser, Elle Gedge, helped her clients to look forward to retirement, rather than worrying about it.
It's natural to feel nervous as you approach retirement. You may have been looking forward to retiring from work for a long time, but the truth is, it's a major life change that can bring stress and well as benefits. As a financial adviser, I love helping my clients aim to achive the retirement and lifestyle they deserve with some good financial planning.
Elle Gedge
I recently visited my clients, Mr and Mrs W, in their home. As soon as we started to chat, they began to explain their concerns about Mrs W’s arthritis and her deteriorating health. She was increasingly finding it difficult to get out and about and her mobility was becoming an issue.
Mr W went on to tell me that he had worked hard all his life for what they had. He was a farmer and travelled to and from work on his bike, whatever the weather, to save on fuel costs, despite being in his early 60’s. This was just one example of how cautious Mr and Mrs W were when it came to their hard-earned money, and they were very open about feeling nervous about their future.
Mr W told me that he would love to retire from the farm as soon as he could because the physical labour was starting to take its toll on his ageing body. It was also clear that Mrs W needed more help around the house as her mobility declined.
Mr and Mrs W were prepared to do whatever it took to enable Mr W to give up work. They told me that they would be happy to cancel their Sky TV subscription, stop their caravan holidays and cut back on things they like to do together such as playing darts and occasionally going out for lunch.
Once I’d listened to their concerns, I spent a lot of time getting to know Mr and Mrs W. I wanted to understand what was important to them and what level of income they would need in retirement, to not only sustain their lifestyle, but to perhaps have more money to enjoy life together whilst they were still able.
Mr W told me that he thinks he had two pensions which he had been paying into a while ago, but he didn’t know where to start when it came to finding out how much his pensions were worth or how to access them. As well as applying for a State Pension forecast, I also completed analysis on the private pension pots that Mr W had been paying into. Once I had all the information I needed, I created detailed cash flow graphs to demonstrate the most effective way for my clients to draw down on their pensions to provide them with a better standard of living in retirement.
My analysis resulted in discovering that Mrs W was eligible to receive a State Pension. As she had always worked part-time, she assumed that she wouldn’t be eligible and so had never looked into it. She was thrilled to learn that she would access this extra income.
I also arranged an annuity which offered a 25% lump sum pay out, 50% spousal pension and 10-year guarantee. This means that no matter what happens to Mr W, Mrs W will remain financially stable and will be able to afford to maintain the standard of living she enjoyed with Mr W.
By arranging the pensions in this way, it also meant that they would have a cash lump sum to fall back on if they needed it. They were excited that this cash injection would allow them to purchase a new automatic car that Mrs could drive so that she could gain some independence again.
Perhaps most importantly, the advice I provided means that they will have a guaranteed income for the rest of their lives – much more than what they thought they would have. I was very aware that Mr and Mrs W had a very low appetite to risk and that their capacity for loss was also very limited. The annuity that I set up for my clients means that they can live the life they have always wanted, but with no investment risk, which was a big concern for them.
It makes me so happy to know that Mr W can afford to retire comfortably and have the funds to enjoy breaks away, including a trip to the zoo (which was on their bucket list), spend time by the coast and enjoy life together whilst they are both able to.
Mr and Mrs W were so appreciative of my help and the relief on their faces was visible when I put everything in place for them. They are now excited about retirement, rather than concerned, anxious and worried. I get to help clients like Mr and Mrs W every day and it makes my job so worthwhile.
Important information
This is an example and what is right for each person will depend on their individual circumstances.
Fees and charges apply at SPW.
The retirement benefits you receive from your pension plan depend on a number of factors including the value of your plan when you decide to take your benefits which isn't guaranteed and can do down as well as up. The benefits of your plan could fall below the amount(s) paid in.
