Case Studies

Searchlight Case studyThe Case of Mr and Mrs “Too Much Tax”

John and Mary were in their late 60’s and happily enjoying retirement. They had plenty of income in retirement from their various pensions, interest off their savings and dividends from their shares. They had accumulated some real wealth and were enjoying it!

John and Mary were about to downsize to smaller, more manageable property. Their children had all moved on and their house was now too big for them. They had found an apartment and downsizing would see £600,000 going from bricks and mortar into savings.

But what did all this mean? And what about Inheritance Tax?

John and Mary were encouraged to meet with Searchlight Investments, who first spent time getting to know their financial situation. Then they helped them to identify the cost of the lifestyle they wanted to continue to enjoy but also got them to think about what else they might like to do in their lifetime to really enjoy their remaining years.
Using sophisticated financial planning software, Searchlight Investments were able to demonstrate that based on conservative assumptions and after allowing for inflation and the potential costs of long term nursing care, John and Mary would NEVER run out of money.

In fact they were on course to die with TOO MUCH! So why’s that a problem?
Here’s why. Despite paying hefty taxes for many years on everything they’d ever earned (income tax and NI), on pretty well everything they’d ever spent (VAT), on every house they’d ever bought (Stamp Duty), they were about to pay another slug of tax when they downsized and purchased their new property.. Tax. Tax. Tax!

But there was an even bigger tax bill just down the road.
Searchlight Investments alerted John and Mary to the fact that much of their hard earned estate was going to benefit someone who had already done very well from them. The Chancellor! If they died soon their Inheritance Tax bill was going to be well over £1million and it was going to get worse the longer they lived.

But it didn’t have to be that way.
Searchlight Investments helped John and Mary work out how much more they could afford to spend, how much they could afford to pass on to their children right NOW and over the next ten years without ever running out of money.

John and Mary are now on course to eliminate their Inheritance Tax liability, to manage their wealth in a way that gives them the life they want whilst gradually pass on wealth to their family so the Chancellor does not benefit.

Searchlight Case studyThe Case of Mr and Mrs “Too Much Risk”

David and Sandra had recently sold their business having worked hard for over 30 years. Now aged 60 and with no children, their primary concern was to ensure a high return on their capital.

Two different financial advisers had discussed various investment scenarios. Each of the advisers had put forward their recommendations based on the ‘risk/reward’ profile they had identified with David and Sandra.

To satisfy their requirement for a high return both advisers had recommended a fairly adventurous investment portfolio heavily weighted towards equities and other volatile asset classes in an effort to secure a high return over the longer term.
However, before investing their money, David and Sandra were advised by a friend to speak with Searchlight Investments.

They helped them identify the cost of their lifestyle over the remaining period of their lives, allowing for inflation and the possible need for long term care. They also discussed and included certain financial goals and objectives that would make their retirement more fulfilling and meaningful.

Using sophisticated financial planning software Searchlight Investments came up with some surprising conclusions. They were able to demonstrate that a return of just 0.5% above inflation would be sufficient to ensure that they never ran out of money.

Searchlight Investments helped David and Sandra understand their number. They helped them understand that there was no need for them to flirt with unnecessary risk. What they needed, in fact, was a lower return with more certainty – a tax efficient portfolio which would give them the peace of mind to enjoy their retirement without having to worry about the markets. It pays to know your number!

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