Mrs M was a 71-year-old woman, recently Widowed.
She had never dealt with the household finances and was very concerned that she would not be able to continue living the lifestyle she had previously enjoyed following her husband’s death and the reduction in pension income.
She also felt that she did not “have a good grasp” of what she was spending and money worried her. We worked through her bank statements with her and established that her regular expenditure requirement was in the region of £45,000 per annum.
Using our cash flow modelling software, we were able to reassure Mrs M that not only could she continue to spend at this level, but she could also even afford to increase her spending by up to a further £13,000 whilst maintaining an investment portfolio of £400,000.
We stress-tested our results, calculating models with the significant market downturns as well as building the scenario that significant care costs would be required.
This provided Mrs M with the reassurance to continue spending at a level with which she was comfortable. She has been working with us for several years now and has recently bought herself a new electric vehicle as well as treating her sister to an extended trip to Australia and enjoying extra cycling holidays around Europe whilst she is fit and able. She would not have had the confidence to have those experiences had she not worked with us.
Our fee £2,000
Summary: How much can I afford to spend in retirement?
- Mrs M ;71 year old woman, recently Widowed, wanted to know “How much can I afford to spend in retirement?”
- Very concerned about meeting the bills now the household income had reduced.
- Did not “have a good grasp” of her regular expenditure requirement.
- Ran several scenarios and calculated that Mrs M could afford to increase her spending by £13,000 per annum.
- Stress tested our results, with significant market down turns and incurring significant care costs.
- Gave Mrs M confidence to continue the lifestyle she was previously enjoying, purchase a new electric vehicle, treated her sister to an extended trip to Australia and enjoyed extra cycling holidays around Europe.
- Our fee £2,000
The contents of this case study are for information purposes only and do not constitute individual advice.
The Financial Conduct Authority does not regulate Cashflow Modelling.