How Do I Structure My Finances Efficiently and Quickly?

How Do I Structure My Finances Efficiently and Quickly?

Broadhurst
Andrew & Sandra had amassed 10 different pensions through various jobs they had had, as well as some ISAs, Premium Bonds, and a share portfolio they’d inherited.

Andrew & Sandra had amassed 10 different pensions through various jobs they had had, as well as some ISAs, Premium Bonds, and a share portfolio they’d inherited. Being busy professionals, financial planning was not foremost on their mind, and despite being seemingly well off the pension were proving to be more of a headache, rather than a comfort.

We undertook a detailed review of their pension and investments. We considered a transfer of their defined benefit pensions, but it was felt they were served to remain in place, whilst their Defined Contribution Pensions were all consolidated. Their share portfolio and ISAs were also consolidated to the same platform and invested in line with their appetite for risk.

Now all their investments can be viewed online at the click of a button, greatly simplifying their ongoing planning. They even discovered that they might reasonably expect to retire a few years earlier than they had previously thought.

How Can I Deal with New Capital?

How Can I Deal with New Capital?

Turpin
When some of our clients approach us, it is because they have suddenly found themselves in receipt of some unexpected capital.

When some of our clients approach us, it is because they have suddenly found themselves in receipt of some unexpected capital. Family deaths can often result in loved ones receiving an inheritance, which can prove to be confusing and overwhelming, especially at such a sad time.

This was the exact situation where one of our clients, Jenny, found herself. Tragically, both of Jenny’s parents died in the same year, leaving her with two lots of inheritance, which she didn’t really know how to utilise. To compound this further, Jenny had recently sold a property, but couldn’t commit to purchasing a new home, as her husband was in the forces, and she was unsure where he may be posted.

One of Jenny’s main concerns was that the cash she held was being exposed to potential tax implications and erosion. She knew that she wanted to maximise her money through investing, but also needed flexibility, so that her and her husband could buy a new home, when the right time arose.

A secondary concern was about the future. Jenny questioned whether she and her husband would have sufficient wealth to comfortably see them through their retirement, so that they could both eventually stop working and enjoy their time together.

I think it’s a misconception that by investing you are locking all of your money away for a protracted period; this isn’t always the case. We looked at Jenny’s situation and decided that a diverse and flexible strategy would be best, so that she could safeguard some of her cash against tax, but also have access to a lump sum when she was in a position to buy a property. However, we also recommended that committing some of the cash to longer-term growth would be beneficial, to help provide a future income by getting her money to work harder.

To help ascertain what amounts to commit, we utilised Lifetime Cash-Flow Forecasting. This visual tool helps to hypothesise various scenarios, such as market crashes, large purchases and holidays, so that we can see what could happen to the overall wealth of our clients. This tool was crucial for Jenny’s situation, as we knew a large purchase was on the horizon, and we didn’t want to tie up too much money. Equally, we wanted to look at what long-term growth could provide for her and husband.

Lifetime Cash-Flow Forecasting helped Jenny to understand how much she needed to keep in a flexible investment, and how much she could afford to commit to longer term growth. However, even more importantly, it gave her confidence and clarity over her future. Jenny and her husband have now purchased a new home and are both looking forward to a comfortable future.

Is My Money Well Invested?

Is My Money Well Invested?

Smith
Investing money can sometimes feel like a scary prospect, especially if this is a new concept. But what if you are a seasoned investor?

Investing money can sometimes feel like a scary prospect, especially if this is a new concept. But what if you are a seasoned investor? Are you confident that you are getting the best possible returns, most suitable level of risk, or highest level of service?

One of our clients, Graeme, came to us mainly out of curiosity. Graeme was already using the services of another IFA and had achieved 10% growth on his pension investment over the last 3 years. Even to us, this sounded fairly good, and Graeme was understandably happy and comfortable with his returns and the investment performance.

However, we wanted to investigate Graeme’s investment further. Continually reviewing your investments, or finances in general, is pivotal to your future success. Just because you have achieved something one year, doesn’t mean that you will continue to see positive results. But it’s more than that; after all, how can you be confident that you are getting the best returns possible if you don’t continue to regularly review your options.

With this in mind, Graeme asked us to research how his investment could have performed if he’d placed it elsewhere.

At Efficient Portfolio, we often use the services of an expert Discretionary Investment Manager. These qualified professionals will continually monitor our clients’ money to make sure that they maintain suitable growth and that the portfolios don’t become overly risky over time.

Our team compared Graeme’s existing pension investment with a comparable portfolio through our DIM and the results were surprising. We found that, if Graeme had invested with our DIM, he would have seen 25% growth on his investment, rather than the 10% he had received in the same timeframe.

Graeme decided to move his investment over to us, as he felt that the additional growth he could receive would help him to achieve his financial goals much quicker and enable him to do far more in his retirement than he could have hoped.

How Can I Deal with New Capital?

How Can I Deal with New Capital?

Russell
Christine had recently inherited £250,000 from her late father as well as a property in the south east of England.

Christine had recently inherited £250,000 from her late father as well as a property in the south east of England. Christine had never earned very much money, having spent much of her life caring for her children and had no experience of investing, or how to go about doing so. What she was keen for though, was that the money could be used to provide her some income, so that she could afford to live a little more comfortably and also have enough set aside to renovate her house and possibly buy a bolthole on the coast.

Not wishing to take a lot of risk, we devised an investment solution that was relatively safe, but which would still deliver, over the long term, sufficient growth and income to meet her income requirements. She was also left £75,000 to do the work to house and enough money to buy to the property she longed for in Cornwall.

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