Case Study: Finding Financial Security After Divorce
Client Overview:
This case study follows our client's journey. She needed to plan her finances from scratch after a divorce following a long marriage. Having previously enjoyed unquestioned financial security, she was suddenly thrust into uncertainty. She needed to plan for herself with the fixed amount from the settlement. Additionally, organising her financial affairs—previously managed by her husband—felt overwhelming and intimidating.
The Challenge:
Our client’s husband had been the main breadwinner, and most of their pensions were in his name. There was a complicated mix of different pension plans, and part of our work was to clarify these, working alongside her solicitor to ensure she understood how they functioned post-divorce.
The divorce process was exhausting, especially when her soon-to-be ex-husband attempted to impose his preferred settlement. She needed to understand which settlement options were most appropriate for her and whether her new financial resources would be sufficient to provide income security in the long term.
Understanding Our Client’s Needs:
We spent considerable time working closely with the solicitor to understand the various pension-sharing options, ensuring the best possible outcome for our client. In parallel, we focused on discussing her future financial needs, concentrating on cashflow planning for later life and identifying a sustainable level of spending and lifestyle.
Consolidation and Clarity:
Once the courts finalised the pension-sharing order, we recommended transferring her portion into a single plan in her name. The next phase involved assessing her income needs and balancing them with her desire to provide for her children eventually. This led to creating a flexible, tax-efficient, adaptable income arrangement as her needs changed.
We put together a cash flow plan that would last nearly 40 years. This plan “sense-tested” her desire for a comfortable lifestyle against the goal of ensuring she would never face financial difficulty in old age. The plan also considered leaving a portion to her children after her passing.
Investment Strategy and Ongoing Support:
Considering our client’s goals, minimal investment experience, and risk tolerance, we developed a low-risk, well-diversified investment strategy. Recognising her initial anxiety, we prioritised regular communication throughout the early years to ensure she was comfortable and understood the process. This approach was instrumental in building her confidence while she took charge of her finances with our ongoing support.
Collaboration with Family:
Our client’s daughter participated in several meetings, providing valuable emotional support and an additional perspective. This collaborative approach helped instil trust and empowered our client to make informed decisions during a particularly vulnerable time.
Empowerment and Confidence:
Through transparent communication and strategic planning, we empowered our client to manage her finances with increasing confidence. Regular updates and clear planning alleviated her financial concerns, allowing her to maintain her desired lifestyle without overwhelming worry. By the end of the process, our client felt confident attending meetings independently and assured her financial future was secure.
Conclusion:
This case study highlights Ifamax’s commitment to guiding clients through complex financial transitions. By prioritising understanding, clear communication, and strategic planning, Ifamax empowered our client to navigate her financial future with confidence.
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Disclaimer: This case study is for informational purposes only and should not be considered financial advice. Please consult with a qualified financial advisor for personalised guidance based on your specific circumstances.