Case Study – Retiree

People often come to us unsure about whether they can afford to retire or how long they need to carry on working for. The following case study demonstrates how we can help you make these decisions with confidence.

One of our existing clients had encashed some investment as his business had suffered a downturn in the economic crisis and he needed to put money into it. Five hard years later, his business had done better, but still wasn’t in a position to pay him back his money at that point or in the foreseeable future. He therefore felt that he needed to keep on working to meet his retirement needs (which meant he kept putting off his dream to buy a boat and sail around the world!).

To add to the complexity of the situation, his wife had had to take some long term sick leave. She had to make the decision of whether to return to work or not but was worried they couldn’t afford to retire, believing they still needed both their incomes. In addition, she was in a final salary pension scheme, so she was concerned she might lose out or be adversely affected if she retired early.

The couple had been clients of ours since 2005 so were used to our traditional financial planning tools, which had served them well. However, when this particular situation arose a couple of years ago we were able to introduce them to the Life Planning application that we were in the process of rolling out. This proved to be perfect for their situation at that time. By running various scenarios in our Life Planning model they realised that they could indeed afford to retire if they wanted to, so the client’s wife was able to take up the option of voluntary redundancy when it was offered.

It was encouraging to see how freedom can be made possible, once people are in possession of the full financial picture.

We were also able to demonstrate to the husband that he could actually fulfil his financial and life’s objectives right there and then, without the money from the business, and that the decision to continue working was in fact one of wanting to rather than needing to.

As a result, he has decided to carry on working but because he loves his work. Now, however, he can do so in the comfort of knowing that he can retire at any time and sail off into the sunset.

This was a wonderful example of how good financial life planning gives you the power to make the right decisions about when you do or don’t retire.