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| Case Studies - Case Studies |
Summary:We helped a business couple to prepare their business for sale so that they could stop working and start doing the things they really wanted to do with their lives. As part of the process we helped them understand how much money would be needed to fund their desired lifestyle without ever running out of money. Background:We had been working with a family owned business for a number of years, when the time came to sell the business and think about retirement. The clients needed help to evaluate the lump sum needed to achieve their future lifestyle requirements. Problems/Challenges:The first issue was to work out how much the client needed to achieve their future lifestyle aspirations. It was helpful that we had been working alongside the business owner, their Accountant and their Business Coach for a number of years. . Following the business sale they needed to organise their finances in a coherent way to make sure that they had a secure basis to provide them with enough income to fund their retirement. Our approach:Prior to the business sale we worked with the other business advisers to help the clients evaluate the value of their business and to help them work toward their exit strategy. As a result of this the clients were able to successfully sell their business to a rival company. Once the business had been sold, we re-evaluated the clients’ future lifestyle requirements which would obviously change as they moved into retirement. This would mean a change in emphasis from accumulating to spending and would mean much more leisure time. We developed a financial plan to demonstrate that the clients had enough money to fund their future lifestyle, and that in fact as a result of the business sale they were in danger of having too much. This could be an issue in the future for their children as they would be liable to pay inheritance tax of 40%. We were able to set up a plan to gift some assets to their children while maintaining enough money to fund their lifestyle. This helped their children to benefit earlier without paying tax along the way. We created an investment plan to generate a flexible income to fund their retirement in a tax efficient way whilst taking the least risk necessary to achieve this. Outcomes and Impact:By working with their other advisors we were able to efficiently help them to make best use of their business assets and enabled them to focus on getting the business into the right format to be sold. We gave them the confidence to sell while they were still fit and healthy so that they could enjoy their accumulated wealth. We also helped them to realise that they had more assets that they would need and therefore gave them the chance to assist their children financially. Continuing Support:Each year we schedule two reviews with the clients. The first is to re-evaluate their financial situation and revise their financial plan so that we can take into account any changes to their circumstances and re-assess whether they remain on target to meet their long-term goals. The second meeting reviews the clients’ investment portfolio and aims to keep it on track towards its goals while taking the least risk needed to do so. Further information: |
