Sam and Janine enjoy excellent health, are in their 50s happily married and were referred to us by another client as they needed a comprehensive review of their financial circumstances after a rather unfortunate experience with previous advice they had received over many years, which had not delivered on their expectations.
At our first meeting, their new accountant attended and went through the financial status of the family's self managed super fund and Sam's business, the accountant then left and we focussed on the personal side of the advice process, this helped to define the goals and objectives Sam and Janine had as well as the timeframes they had in relation to retirement and debt management.
It was vital to have a plan which showed them how best to structure their funds to accommodate their personal circumstances and their desire to retire debt, fully protect themselves from any unforseen circumstances and retire early if possible, they also wanted to draw a line in the sand and start with a fresh hands on approach to their finances.
They wanted to delegate all of their current financial stress to an experienced professional they could trust
They wanted a lifestyle of choice so they could have the opportunity to make decisions quickly to do everything that was important to them, Sam also had a keen eye on a new motorbike he wanted to purchase.
They also wanted to consolidate a number of super funds they had accumulated over the years and explore the possibility of transferring a UK pension Sam had in England.
The financial position
Sam worked full time in his own business on a salary of $100,000.(net)
Janine worked as a senior manager with a prominent building company earning approximately the same as Sam.
They owned approximately $1,800,000 in lifestyle assets; including their home, its contents and motor vehicles. They have approximately $850,000 in financial assets - made up of cash in their bank account, individually-held shares, an investment property and numerous superannuation funds. The clients had non deductible debt of $550,000 and were keen to pay it down as soon as possible .
We identified they both had no personal insurance which was a concern if anything should happen to either of them and Sam's income from his business was not protected should he be unable to work for any reason. They both also had no personal wills in place and were identified as growth investors and were keen to learn more about financial markets and superanuation.
Our plan for Sam & Janine
Our first step was to establish exactly what superannuation funds they both had external to their existing self managed fund, and to establish what the UK pension benefit was for Sam.
We had little information to go on from old statements and some funds we found were in Janines, previous name, by doing a comprehensive super search and working with our contcats in the various superannuation companies we uncovered over $107,000 of superannuation money that had been long forgotten and left in default funds, some with the ATO earning no interest.
Sams UK pension was also investigated with suprising results as its value had escalated and was worth more than anticipated, Prosperity Partners was then engaged on a fee for service basis to arrange the transfer of the UK pension to the couples self managed super fund and to consolidate all the external super funds to the family self managed fund as well, overall a total of $180,000 of additional funds were credited over a 3 month period.
We were then engaged to provide advice on structuring the best possible personal insurance strategy for the couple, which took into consideration all the goals and objectivs they both had and to ensure any debts and income were fully protected in the event of any unforseen circumstances occuring to either of them.
The next step was to refer Sam and Janine to our trusted alliance partners at a leading commercial law firm to ensure they had personal wills established and that they reflected Sam and Janines wishes in relation to estate management, we briefed the lawyer on their behalf and provided all relevant documentation and introductions so the process was seamless and effective. Most importantly Sam and Janine now had peace of mind.
We then met with the clients and their accountant to review the self managed super fund and its asset allocation, a decision was made to fully revamp the fund and its investment strategy and this was done by working with the accountant, we also provided the accountant with a copy of the estate plan drawn up by the lawyer (with the clients consent) so he was fully informed of what was going on at all times, our team refers to this as the "Trio of Trust" Sam and Janine now had a professional team looking after them and working hard to deliver the best possible outcome for them not anyone else.
A strategy to pay down the family non deductible debt was then devised and the plan established to help achieve all the goals Sam and Janine had set out to us at the initial meeting.
A review every six months was then put in place for Sam and Janine with a fixed price service package selected that covers all the requirements they will need form Prosperity Partners for the year.
Now everything is in place we find we regularly chat with Sam and Janine and they pop into the office for a coffee if they are in the area, checking anything financial with us before they do it and yes Sam even got his new motorbike.
Sam and Janine wanted to remove as much financial stress as possible from their life. After all, they had more important things to worry about. So they engaged Prosperity Partners as their Principal Wealth Advisor and we took control of all their financial affairs.
A final comment from Janine which made us all smile in the office
I must admit, I wasn’t looking forward to our initial meeting but after having met with you, Sam and I felt much more comfortable about looking toward the future rather than back at our mistakes."
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