In this series of case studies, based on client testimonials from VouchedFor, FTAdviser speaks to advisers about particularly emotional or complicated financial planning cases to find out how they helped clients at difficult times in their lives.
Adviser name: Simon Cutler
Firm name: Blackdown Financial
Firm size: 4
Client life stage: Approaching retirement.
The problem: The client was working full time when her husband was diagnosed with terminal cancer. She had no idea about the value of her workplace pension, or the collective value of any savings and investments. She was very worried about how she would manage financially in the future when her husband passed away.
Cutler tells FTAdviser: "This was really quite a tough scenario In 2014, her brother, who was my client, recommended her to me. Christine's husband became terminally ill and she was obviously concerned and upset about her future.
She lives near Torquay, and I am in Taunton - so it was a hundred-mile drive. But I arrive at her house to see a table full of carrier bag of documents - bags full of statements she'd kept for years and years.
All she wanted to do was to know if she could afford to retire early so that she could look after her husband. She had all the documents - but had never sorted through them or been able to organise them.
FTAdviser: How did you approach the situation?
She was 55 and had eligibility to retire, but didn't realise she could, and certainly did not realise she could afford to.
We looked at her income needs and worked out that, with her workplace pension and the various cash savings she had of approximately £150,000-£200,000 spread across different accounts, I could put a plan in place for her to allow her to retire early and care for her husband in the last year or two of his life.
Her first words to me were: 'What am I going to do?' She was clearly vulnerable. It was a very difficult situation for her.
She had minimal financial education; she worked as an administrator at the Royal Mail so she knew the importance of saving.
She'd put the maximum she could into Post Office accounts and National Savings, but back then the deposit rates were awful and not earning her any money.
She had every statement going back 20 years but had never gone through it.
So the first thing I had to do when I saw that mountain of paperwork was take a deep gulp and start looking through the documents.
FTA: What was your solution?
It soon became clear from the various statements that she had enough cash and a decent pension - it was more a case of structuring her finances and making a cashflow plan for her that was suitable for her risk profile.
She ended up taking the Royal Mail pension early and retired within the month.
We kept six to eight months of cash readily available to cover any costs that might arise as her husband's health declined, and I set up an income-based investment bond that would start paying a regular income after a 12-month deferred period.
Advice is currently an old man's game and it needs to pivot to be directed at a younger, diverse generation.Simon CutlerFrom an advice perspective it was not complicated, but she did not know how to organise or structure her finances.
We use cashflow planning tools, so I could show her what she needed to live on and present a picture of her finances in the years ahead.
The Post Office exercised her request to retire very quickly and it is one of those rare cases where every provider in the chain acted promptly and efficiently.
It took no more than six to eight weeks to put everything together.
FTA: What were the challenges?
Clearly, her vulnerability and lack of financial knowledge - as well as a lot of paperwork that had built up so that it became overwhelming.
Also this was very emotionally raw for her - she had lost her first husband to cancer, too, so we were there to support her as a person through this traumatic time.
FTA: What was the outcome?
She is still my client, although she lives so far away from our office. She is an advocate of our company and I have a six-monthly meeting with her, either face-to-face or on Zoom.
She’s so happy that she has the financial freedom to travel and spend time with friends, and she has more than enough income to cover her outgoings.
FTA: An adviser once told me he doesn't have 100 clients; he has 100 friends. Is that how you feel?
Yes, I do feel this. We do have really close working relationships with everyone.
The degree of closeness differs, depending on what the client is looking for. We have a good informal as well as business relationship with people - and we don't lose clients.
FTA: What would be your top tip for someone starting out on their journey to become an adviser?
Advice is currently an old man's game and it needs to pivot to be directed at a younger, diverse generation.
I would encourage people to look at companies which have training academies - this is a great route for people to get into the industry. We offer mentoring and take people on board as paraplanners, but not many advice companies can offer that route.
I attended a Personal Finance Society webinar the other week where they said approximately one in two advice firms have just one adviser. So not every business will be able to take on trainees.
I also think working for a bank, which is how I started, was a good route in, as it meant I had to deal with customers regularly and learn those 'soft skills' that is vital in a people-based business.
