Background
Male client aged 60. Legal Director of large firm of solicitors in Birmingham. He had a number of pension arrangements through various past employments. He was unsure of his overall financial position and when he could retire.
Challenges
1. Pension Position
- Client wanted to know what he had in terms of pension provision
- Wanted to know what to do with the various pension arrangements
- Wanted to know what his options were in terms of taking benefits
2. Employment
- Not sure how long he will continue working
- Not sure how much he will continue to work for
3. Position on death
- Worried about potential Inheritance Tax liability on death
What we did
- Simplified and consolidated most of existing pension arrangements
- Gave him a clear view of what he could expect from his pension arrangements
- Explained all options in relation to taking benefits and how this could be structured tax-efficiently
- Set up trust in connection with new pension arrangement
- Introduced structured review programme to consider ongoing income needs
The results
- Gave client control of his pension investments, creating peace of mind
- Reduced paperwork and complexity of arrangements
- Reduced potential Inheritance Tax liability by £80,000
- He reduced hours to work part-time initially and then retired and took up temporary positions on his terms
- In process of arranging a tax efficient ‘income’ so as to avoid higher rate tax liability