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: Rory Albon
Firm name: Lyndhurst Financial Management
Firm size: 10
The problem: My clients were a young couple just starting out in their life. They had questions about their finances, pension savings and mortgage payments, and had very little exposure to financial advice, as well as very little in the way of liquid assets.
Albon says: "I never wanted to be a sales person or to have to hit targets - this was a concern that I had, coming into the industry from Amazon.
I had been at Amazon for 10 years - it is people-oriented and solutions-based and it is about fitting the puzzle piece into the gap.
In that respect, advice is similar in terms of problem solving, but the people - the client - has to be paramount.
I knew almost immediately that I wanted to be independent rather than restricted - stepping away from the sales element and to be able to pick whatever puzzle piece fits that client perfectly.
Tell me about this particular couple
They were different to the normal clients that advisers have in that they had no assets to speak of. These were a young family in their early 30s. Not too dissimilar to me, in fact.
Back in the days of lower interest rates, they had taken out a hefty mortgage on their property.
The husband had just started a new job on a good salary, while the wife - a part-time teacher - earned a lot less.
They initially wanted to see if they could reduce their mortgage now that interest rates were rising, but not wanting to hurt their long-term retirement plans.
It was an interesting conversation to have.
What were the challenges?
The biggest red flag was that he had no income protection if he was unable to work.
So I had to do that. That's a hard conversation - they came to me in the hope of saving money and the first thing I did was tell them to spend more.
But, using cashflow forecasting and scenario plans I could show the client not just their long-term savings and mortgage reductions, but also what might happen if he could no longer work.
I could show them how quickly they could drift into the red.
The second step was going through his workplace benefits. He had a generous employer who was making a good payment into the pension, unrelated to what my client was putting in.
Also, as he worked in sales, he was getting good commission payouts, so this gave us an opportunity to use the commission bonus as surplus income to save for the mortgage, and to make overpayments into the pension to save tax.
