Case studies and testimonials

What ongoing, specialist advice has done for our clients

Three case studies in full, followed by clients’ own accounts of working with us.

Capital Preservation
Family Wealth Transfer
Tax Efficient Income
Testimonials

Case Study 1

Capital Preservation

The situation

John took a transfer from his employer’s final salary scheme in 2000. He had held a senior role with his employer but felt that the annuity pension offered by the pension scheme did not offer him the flexibility that he wanted in retirement. He knew that he and his wife would take expensive holidays in the early years of retirement but were likely to spend less on holidays as they got older.

The transfer value offered was large, £1.2m, and John wanted to make sure that this significant asset would not be lost to his family on his death. He was very aware that, as his children were adult, they would get nothing from the scheme on his death. If his wife pre-deceased him then all the pension that he had built up over the years would be lost if he stayed with the scheme. However, his main concern was providing an attractive and sustainable income for himself and his wife.

So in 2000 he took a transfer value of £1.2m from his employer’s final salary scheme. He took the maximum tax-free cash available to him (£180,000) and used this to have a special holiday, clear his mortgage and leave some savings available to him. He was therefore left with a pension fund of £1,020,000 available to provide himself (and his wife) with an income.

Our advice

John did not have any previous investment experience and came to us for advice. We discussed John’s aims and objectives: his desire to take a relatively high level of income in the early years of retirement, to make sure that the income would last his lifetime, and the desire to preserve some of his fund for his family.

We matched the level of risk he was willing to take and was able to take to a portfolio of funds from our researched investment panel. Mindful that income was being taken, we selected an appropriate investment strategy. We reviewed it regularly with him and ensured that his income was provided from appropriate assets and long-term growth provided from other assets. This way we could ensure that in times of falling stock markets the income being taken did not disproportionately erode the fund.

The result

Currently John takes an income of £76,000 gross per annum from his SIPP. Since taking the transfer value John has had total income of over £800,000 from the SIPP and his fund value in July 2018 is £990,000.

John knows that the level of income he is taking is high compared to the level of fund value and this may lead to capital erosion. However, for the moment he is happy with it. He knows that we will continue to work with him to ensure a sustainable income for life whilst retaining a fund to pass to his family.

He trusts us to advise him on income levels and investment strategy, as we have proved to him over a long working relationship that we understand income drawdown and have proven expertise in this area. This example shows the power and importance of on-going advice and of having an adviser who specialises in this field.

The purpose of this case study is to provide technical and generic guidance and should not be interpreted as a personal recommendation or advice. Any tax treatment depends on the individual circumstances of each client, Tax Planning is not regulated by the FCA. You may not get back the full amount of your investment.

Please note: Rates of tax and the legislation that governs them are subject to change, and this information was only accurate at the time of writing.

I was impressed with their down to earth approach, their knowledge of pensions and understanding of complex taxation legislation.

Neil RossCEO, Standard Life Bank (Retired) · Client testimonial

Case Study 2

Family Wealth Transfer

The situation

Colin ran a successful property development company. By the time he reached his 60s he had amassed significant assets both inside and outside his pension. His SIPP was worth over £2m, he had significant amounts in cash and a main residence also worth over £1m. He was married to Anne, and had 3 grown up children and 8 grandchildren.

Very sadly, Colin was diagnosed with a terminal illness which gave him a much-reduced life expectancy. He wanted to plan how to pass his wealth to his family in an efficient manner and to make sure that his wife was financially cared for, for the rest of her life. He wanted his children to receive an inheritance and to leave some money for his grandchildren.

He was concerned that as he had a large estate, his beneficiaries would have a large inheritance tax bill to pay. He had always intended to plan for inheritance tax but had never given it any priority.

The SIPP provided the answer

Colin had intended to leave the SIPP to Anne and split the cash between his children and grandchildren. This might be considered the traditional approach: to provide a pension for your spouse from your pension. However, after discussing matters with us, this was not what Colin did.

Colin left the main residence and all the cash to Anne. There is no inheritance tax between spouses and Anne therefore had a home which she could, if she wished, sell and downsize, plus a significant cash sum to provide her with income through her life.

The SIPP was split between the children and the grandchildren (in different proportions); none of it was left to Anne. The beneficiaries received their share of the SIPP fund with no inheritance tax nor any capital gains tax.

As Colin died before age 75, any money that the beneficiaries withdraw from the SIPP will suffer no income tax. The grandchildren could pay their own education costs or get themselves on the property ladder. The children, who had not been able to fund pensions of their own, inherited a tax-free income source.

The result

There was no inheritance tax bill and the SIPP provided the best way of leaving a legacy to his children and grandchildren in a way that suited Colin. Had the SIPP been left to Anne and she survived beyond age 75, then any remaining fund she passed on would be subject to income tax on the beneficiaries, so again, not leaving her any of the SIPP was efficient tax planning.

This example shows that taking advice from someone who fully understands the advantages of using the SIPP as a vehicle for family wealth transfer can maximise the amount passed to family and provide a legacy for generations to come.

Please note: Rates of tax and the legislation that governs them are subject to change, and this information was only accurate at the time of writing.

I would sum up my relationship with 336FM in one word ‘trust’. I trust them to make my money work hard, their service is great and their charges are reasonable. They are clear and up front about all the information I need to know.

Kenny PollockClient testimonial

Case Study 3

Tax Efficient Income

The situation

Douglas used to work at a large fund management company. When he left he retained a substantial number of shares with the company, which produced dividends of approximately £32,000 per annum.

He also had a large SIPP worth over £9 million, property worth £2 million and non-pension assets (OEICs and ISAs) worth £2.7m. Douglas’ wife has no income in her own name.

Douglas wanted to take income from his SIPP but did not want to pay the 60% effective income tax rate that would apply if he took income between £100,000 and £122,000, nor did he want to pay 45% income tax if he took income over £150,000.

Our advice

Switch the shares to Sheila’s name, where she would pay tax at 7.5% (this would be 32.5% if Douglas retained the dividend income).
Douglas to withdraw only to a maximum of £100,000 from his SIPP, thus retaining his personal allowance and paying an effective rate of tax of 29.7%.

Any additional income could be generated from non-pension assets, making use of capital gains tax and ISAs. Sheila would pay capital gains tax at 10% and Douglas at 20%, both currently lower than income tax.

The result

In addition to saving income tax, Douglas is preserving his pension fund, which will create a substantial legacy (potentially £9m) for his family which can be paid with no inheritance tax. Douglas is aware that the property and non-pension assets could give rise to a substantial IHT bill if left to his family.

Taking regular expert financial advice has allowed Douglas and Sheila to provide themselves with a very tax efficient income and also to create a substantial legacy for their family, of which potentially £9m will be free of IHT.

Please note: Rates of tax and the legislation that governs them are subject to change, and this information was only accurate at the time of writing.

The moment my husband and I met Douglas we knew he and his team were the right advisory firm for us. 336FM are extremely professional. We are always confident in the decisions we make as a result of the practical, easy to understand advice they give that’s personal to our circumstances. When we leave their office we feel happy about the actions we’ve taken and our financial future. We’ve been pleased to recommend them to our family and friends.

Jayne PonzioStrategic Brand and Marketing Communications Consultant · Client testimonial

Testimonials

What our clients said about us

★★★★★

Excellent customer care, very good communications

Ross HamiltonGoogle review

Building trust

Having talked to other local IFAs I can say that with 336FM I felt I was dealing with a person and that was important, I didn’t want to be just a number.

LRClient testimonial

Building trust

When I was made redundant, they supported me, it could have been a minefield, but I trusted them more than I trusted myself. I have experienced periods without work, several jobs involving other pension schemes and the advice they have given me along the way has been spot on. I have always felt they are dealing with your money and life circumstances with your best interests in mind. They are good listeners.

JTClient testimonial

Building long term relationships

After having a major health scare, I had no idea what I wanted to do, even whether I would have to go back to work or whether I could retire. The team at 336FM helped me understand my options, which wasn’t easy because I wasn’t able to read or understand information well, but they put together a report for me and my sister, who was helping me. I had an overwhelming sense of relief, it felt like a huge weight had been lifted off my shoulders, when they told me ‘you don’t need to go back to work if you don’t want to’. Going forward I feel I have a relationship built on trust and would be happy to do what they advise me.

JLClient testimonial

Building long term relationships

I have always appreciated their professionalism and how they have managed my money and look after my future. But the real test of their ability came to the fore last year when I lost my husband. The team stepped in and sorted out my finances and dealt with my husband’s pension provider, who weren’t giving me any information, 336FM made sure I received the widow’s pension I was entitled to. At a time when your world has turned upside down you need to have someone who you can phone and be able to trust them to sort financial matters out for you… that’s what 336FM did for me.

GGClient testimonial

Tailored personal advice

When I lost my wife, they never lost sight of me and tailored their advice to me and my family personally. The breadth of their professional knowledge, how I should think about investing for the future for me and my family, is excellent.

RBClient testimonial

Beating the competition

I had approached a couple of other IFAs before meeting 336 FM and my experience hadn’t been great. I wanted to understand the best approach for dealing with my deferred defined benefit pensions. Having chatted with them I felt their approach was refreshing, informal and gave me a good feeling about any future potential relationship. They took the time to ask what I needed and gave me a much better understanding of what I could expect when I retired. Their interest in me personally was so much better than any other adviser I had talked to previously.

DDClient testimonial

Innovative financial planning

My partner and I wanted to move to a new house and we had seen a property we liked but we didn’t want to sell our flat at that time. 336FM helped us work out options to allow us to give the lawyers and the seller the assurances they needed to reserve the new property for us. It was all turned around very quickly and efficiently by 336FM on our behalf. This was not something I would have thought an IFA would be able to help with – I was really impressed.

DDClient testimonial

Innovative financial planning

I consider myself to be well informed about the financial services industry, working in the technology side of the business, and I can happily say I have been very impressed by 336FM. Their professionalism is very obvious, they have come up with an innovative plan to deal with drawdown as well as having the foresight to partner with a very good investment management group, Square Mile. They are very qualified to give advice, they are professional people who are constantly looking to the future to offer their clients the best advice. One of the senior people I worked with in the industry referred to Douglas as the ‘Adviser to the stars’. Being a golfer, I see him as the Butch Harmon of financial advice.

REClient testimonial

Solid partnership

When I asked the Personnel Director about my pension scheme and what my options were, he really had no idea beyond the company’s pension plan rules. That’s where 336FM stepped in and advised me, and my wife, what to do for the best. Since then, whether it is getting access to our cash or needing written information, they have been prompt, providing the best sources of information and making me feel very comfortable. I trust them and their approach.

ALClient testimonial

Solid partnership

Their success as a business is generally unheralded. We wanted to go on an around the world cruise and we had no idea how to fund it, where we would draw the money from. The guys at 336FM sorted it out and made it very easy and straightforward.

RMcQClient testimonial

Please note: Rates of tax and the legislation that governs them are subject to change, and this information was only accurate at the time of writing.

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