Updated: Oct 26, 2022
We never know what's around the corner. Life holds many surprises - not always pleasant - which can make a mockery of all our plans. This is particularly true when it comes to health. Serious illness is usually life-changing, and throws up all sorts of problems, apart from purely physical. When faced with such a crisis, it's important not to lose sight of financial issues, as neglecting them is only likely to add to your store of worries further down the road. At Reeves, we always emphasise that any material change in circumstance should prompt a close look at your financial plans.
The following case study was provided by a third party pension transfer specialist: Recently, a client was referred to myself from Reeves. She lived with her partner Dave, with whom she had two young children but she also had two adult children from a previous relationship. Lisa had a terminal illness and wanted to make provision for all her children from her defined benefit pension plan which had a transfer value of £100,000. Under the terms of the scheme, an income was only guaranteed for a spouse, but she wanted the whole value to go to her children.
As a third party transfer specialist, I deemed that a transfer was suitable and completed the transaction. Now the children can share the £100,000 pension pot tax free as Lisa wished. By Reeves referring this case to myself, Lisa was able to seek advice before it was too late. This ensured her eldest daughter could put a deposit down for her first home; her second daughter was able to afford the wedding of her mother's dreams and the two younger children had money placed in a trust until they reach 18. Lisa's story underlines how important it is that when your personal circumstances materially change - for better or worse - you seek financial advice. That way, you may be able to avoid making a bad situation worse and perhaps you can make a good situation even better.
It is important that no actions should be taken without first taking advice. Personal circumstances and an individual's appetite for risk means that the advice for one person may not be the same for everyone. The information in this blog or any response to comments should not be regarded as financial advice. Reeves do not advise on Defined Benefit pension schemes. Reeves do introduce a third party specialists in areas of work we do not cover. Please note: This article has been published with the client's consent but name changed to protect their identity.