One of the delights of the job that we do is to hear about the plans our clients have for their future.
For example, two of ours have decided to kick off their retirement by travelling around Europe for a year, and have purchased a very smart, actually quite luxurious, motor home in which to do it.
The gentleman has acquired a tee-shirt that sums it up nicely, emblazoned with the slogan “Adventure before Dementia”. Perhaps not everyone’s sense of humour but you can see where they are coming from.
While they are away on their grand tour they are renting out their home. The rental income this generates together with their pension and investment income is likely to mean they will have more money in the bank on their return than they had at the start of their adventure.
The adviser’s helping hand
Many people require some kind of help in making a decision like this. Indeed, that help can make all the difference between something remaining a dream and becoming a reality. Readers will know that this help is called financial planning. More and more people are beginning to understand that what is really valuable is having a plan.
I do not really like the word but that plan needs to be “holistic”, looking at all aspects of their financial life and drawing a line between the various dots. It needs to answer, as far as possible, important questions such as whether they can afford to do it without running out of money later on.
Of course, nothing about a person’s financial future can be absolutely certain but the planning process seeks to identify what reasonable expectations look like.
“More and more people are beginning to understand that what is really valuable is having a plan.”
Putting products to one side
Financial planning also includes financial advice. It may well be that the client requires a new financial product, such as a pension or an Isa, or some kind of adjustment to a product they already have.
Product implementation is important but it is not the most important part of this work. It looks good when we can tell a client they have perfectly suitable financial products in place and all that is required is a tweak rather than a wholesale change.
The real value is in the plan. Helping people to see how they can use their wealth to achieve their goals and objectives delivers job satisfaction to me and value to the client.
Perhaps we should suggest these soon-to-be-travelling clients pop in to see another of ours whose plan gave him the confidence to up sticks and go and live in Northern Italy. They could share a cappuccino together at a street café in Pisa, as he tends to do each day.
Retiring ahead of schedule is a classic dream for some of the clients that come to us. Showing them that they have enough financial resources to do so now rather than continue the tiring battle of work can be a real delight. It is about giving them a degree of certainty in an uncertain world and the confidence to take a leap.
As my client said: “Retirement is a big adventure and a step into the unknown, but we can start this journey with real confidence after working through our financial plan”.
That says everything about what we all do, really.
Nick Bamford is executive director at Informed Choice