Case Study #2: George & Angela. How Important Is My Business?

George was in negotiations with his business partner about retiring, and potentially his partner buying him out. The conversation was tense, sensitive, and protracted. George and Angela had substantial financial assets and property assets. For the negotiation, George wanted to know how important his business assets were in supporting the sumptuous lifestyle they were both accustomed to.

Retirement appeared to be a cliff edge for George. He was worried about spending all his time with Angela. Their marriage wouldn't survive it. Especially if Angela knew how much they had in savings. He was worried that she might do as other friends had done and filed for a divorce. George wanted to exclude Angela from the financial planning meetings.

George told his planner, "I'm not going to take matrimonial advice from my financial adviser."

George's questions were:

• He felt intimidated and bullied by the rather aggressive response from his IFA when expressing his concerns and was consequently reluctant to raise a complaint.
• He didn't want to place all his financial assets with his stockbroker but wanted to maintain the existing mandate with them as he appreciated the relationship.
• He wanted a lifetime financial forecast with the business asset excluded from the base plan and included with various valuations in "What-if" scenarios.
• He wanted to assess the impact of a more lavish lifestyle, gifts to his son, care fees for them both in later life, and an ambitious property development project would have on his capital. Would his capital outlive him and Angela?

The first step is I insisted that Angela join us for the goal-setting sessions. Both George and Angela described their values, talents, and what their favourite future looked like, while the other listened without interruption. Later commenting on their thoughts. At the end of the goals session, we could piece together a common favourite future that was inspiring for both in retirement.

The critical component of the favourite future was purchasing a holiday home in Florida and a new build project of their ideal forever home in the UK. George was unsure if he'd like to spend time playing golf with Americans but was willing to give it a go.

Another plan component was to set money aside for George to pursue a meaningful project with Paul.

Working together with their financial planner, George and Angela wanted to explore:

• Pursuing a complaint against his IFA and feeling supported in the process with facts and figures.
• For comparison purposes, the possibility of self-investing financial assets outside the stockbroker's discretionary mandate exists.
• George wanted to stress-test the outcome of the whole financial plan over a wide range of scenarios and market conditions to give him confidence and peace of mind over the results.
• Consider the tax implications in the life and death of their decisions.
• The environmental impact of their investment decisions, every £1 you invest is a decisive vote for the change you want to see in the world.

Being able to see and understand all options removed a lot of worries. They could move forward with their plans, confident they would be well looked after.

The solution adopted by George and Angela helped them in many ways:

• The complaint was eventually referred to FOS and upheld, and a satisfactory compensation payment was made to George.
• The plan took the pressure off George's exit negotiations with his business partner; he waited for his best deal. During covid, his pharma company's valuation skyrocketed, and he and his business partner agreed to a very lucrative sale to a Dutch company that left George and Angela with twice the net worth they had anticipated.
• George studied all the evidence-based investor materials provided over a long period. It gave him the confidence to self-invest. He directly chose Vanguard ESG Developed World All Cap Equity Index Fund with Vanguard to avoid excess charges. George wants his planner to teach EBI to Angela and Paul should anything happen to him.
• Though his self-investment has outperformed his discretionary manager, he retained him as he values the relationship.
• George and Angela remain happily married in their retirement. The American golfers were more fun than he had anticipated, plus there are many Brit ex-pats in Florida.
• George is still trying to get Paul interested in conscious capitalism and a meaningful joint project. It's a work in progress.
• George and Angela have the capital they cannot outlive over many scenarios, giving them the peace of mind to enjoy their retirement.

Today, George and Angela are having the time of their lives. They travel between their home in the UK and their house in Florida, visit new golf courses, and spend time with their son every chance they get.

They are confident that their financial plan is sustainable and that they can both relax and enjoy life on their terms.

Note: The above case studies are hypothetical and do not involve an actual Advice-only Financial Planning client. A client or prospective client should construe no portion of the content to guarantee they will experience the same or a specific level of results or satisfaction if Advice-only Financial Planning provides financial planning services.

Next Case Study.