Background

​

As Bill and Wilma approached their desired retirement age they were keen to ensure they maximised their retirement income and made the most tax efficient use of the assets they had accumulated. Bill and Wilma held a number of pensions, assets and buy to let properties which they planned to use to fund their retirement.

​

Key Client Considerations

​

They were however not too sure what all their assets could deliver in terms of income and how long it would fund their retirement for. They also wanted to know more about the recent changes to pensions legislation which they had read about in the papers and how they might leave something for their two grandchildren. Bill lead a very active life and felt he did not want to stop work completely but wondered about how a part-time job might affect his tax position. As they both had been reasonably cautious they also wanted to be sure they were not taking an unnecessary risks as they moved towards their retirement.

​

Approach

 

During our initial meeting we spent some time answering their questions and explaining the changes under “Freedom and Choice in Pensions” and the potential choices and opportunities for them at retirement. After our initial meeting we sat down with Bill and Wilma and agreed some goals around their lifestyle in retirement before drawing up a cash flow forecast which focused on their long term retirement plans. This helped demonstrate how continuing to work / stopping work and the different levels of income associated with each scenario affected the amount of income they could receive and also the legacy they might leave their family. We were also able to factor in the cost of taking a 6 month round the world holiday early in their retirement. We were able to reassign some of their assets to improve the tax efficiency of their savings as well as utilising some of Bill’s tax free cash from his pension to fund the holiday.

 

Outcomes

 

Working together meant that Bill and Wilma could take their dream 6 month round the world holiday as well as helping them both take a retirement income of over £20,000 per annum and remain basic rate tax payers. Bill and Wilma now have annual meetings with us where we update and review their lifetime cash flow forecast and financial plan, providing them with financial peace of mind, to live the life they want, secure in the knowledge that they won’t run out of money and they have the flexibility to provide for their grandchildren as they wish.