MEETING YOUR PERSONAL GOALS
AND ASPIRATIONS

In his late thirties, our client is now starting to earn well, feeling settled in his career and seeing a period of the next 10-15 years when he can put money away for his and his family’s futures. With a large mortgage and young family however, the pressure is certainly not off.

We initially completed a financial review including a full ‘health check’ and cash flow modelling. We put in place some additional protection and have an agreed strategy for paying down debt and longer term investment into pensions and ISAs, utilising tax allowances for the whole family. With a demanding job, time is precious and we now provide a relatively low-touch service, advising on investments for growth and checking in annually to ensure everything remains are on track.

Our client’s main focus in recent years has been the investment of excess income whilst also looking for opportunities to reduce his overall income tax rate – suffering from a relatively high effective tax rate due to the partnership structure. We have worked with the client to maximum fund pension pots and have also recommended EIS and VCT investments.

Now approaching his late fifties and planning to retire within the next 12 months, we have recently re-worked the long term cash flow to develop the strategy for how he and his partner's lifestyle will be supported post retirement.

Our client realised £4m from the sale of his business – quite a change after earning very little as the business was built. In his early forties and with a young family, we were able to work with husband and wife to build an understanding of what that money could – and could not – achieve and what the next stage of their life might look like.

We arrived at a relatively cautious strategy to protect the family wealth while he considers longer term business plans. Effective long term planning was put in place with pensions and ISAs for all family members. Some monies were retained for future house purchase and a portion invested for long term growth.

Our client was introduced to us shortly after he took redundancy – in his mid-fifties - from a senior executive role in a FTSE 100 company. His initial concerns were a number of practical issues around the loss of some financial services which had been provided by his employer, and then how to support his lifestyle with the loss of approx. £300k p.a. income. The client held £1million in cash and a significant holding in the shares of his ex-employer.

Following an in-depth financial review, we were able to fill some immediate gaps and introduce him to a tax accountant. His departure was structured as early retirement and we provided advice on how best to take income from his pension scheme. Allaying short term concerns, we then developed an initial strategy which focused on generating sufficient income from pension and other assets assuming he had no further work. We developed a coherent investment strategy targeting capital preservation and looking at appropriate structures to deliver tax efficient income.

Typical of many family run businesses, our client had little intention of retiring but was starting to think about what would happen when he was no longer up to the role of running the family business and by extension the family wealth. Across business, property and investment assets, the family wealth totalled around £20million but much of it held in illiquid assets and inextricably tied up with the business.

We were asked to consider a strategy for inter-generational transfer. Our first point was to understand the wishes and needs of different generations within the family and to work to a shared understanding of the longer term goals. Secondly, we looked at the cash flow under different scenarios to understand how best to meet future income requirements and potential liquidity needs. And finally, we were able to develop a strategy incorporating effective tax planning and crucially support for the next generation.

Our client has had a number of business interests over the more than 10 years he has been a client including taking a company to market and angel investing in other start-ups. He has equally been keen to support his own children in developing their entrepreneurial flair, lending money to assist his oldest son in launching a business.

With wealth of around £5million but as a natural risk taker, we have acted in many ways as a cautious voice and sounding board. We have ensured appropriate pension arrangements are in place and that core investments are managed to balance his higher risk business activities. Equally, though we have been able to leverage the FF&P network to provide introductions to like minded individuals with potential for interesting investment or non-executive roles.

Recently retired with a fully funded pension and having accumulated around £1.5million of other assets, our client is looking forward to a relaxing future with a first grandchild just arrived. Both husband and wife are aware that they may have to eat into their savings in future years but are equally keen to support their children wherever possible, particularly to assist in getting on the housing ladder. Our client’s mother is increasingly frail and they are conscious that there has been no planning around her financial affairs.

We have worked with the clients to demonstrate the impact of inflation eroding their spending power and the impact of different market conditions. We have agreed and advised on an overall allocation of assets to meet their risk profile. We are also now working with the mother to ensure her affairs are in order to support her immediate cash flow requirements and considering potential strategies for inheritance looking across the generations.