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Financial Needs and Cash Flow Analysis

Financial Needs and Cash Flow Analysis

I need to know what lump sum I need from my divorce settlement to be financially independent

Client Circumstances

  • Mrs Lloyd is aged 46 and has 2 children aged 16 and 18
  • Mrs Lloyd is negotiating her divorce settlement
  • She has already purchased a house in her own name with no mortgage
  • She has no idea of her income needs or expenditure
  • She has no income
  • She needs to know the lump sum needed to be independent after she is divorced

Recommended Solutions

  • Unknown expenditure verified
  • Lump sum calculated with a detailed report with spreadsheets (outlining assumptions)
  • Negotiations can take place with accurate data
  • Mrs Lloyd understands consequence of lower settlement before accepting
  • Mrs Lloyd can obtain advice after divorce for the financial plan implementation
  • Advice is obtained from a Resolution accredited specialist adviser
  • State pension “substitution” is undertaken via Scrutton Bland

Benefits from advice given

  • Equalises real value of pensions to both Mr and Mrs Nicholls
  • Avoids MVA penalty being applied to Pension 2 (would have been reduction of 10% to 20%)
  • Mrs Nicholls retains valuable Guaranteed Annuity rate on Pension 4 (this increases income on this plan by some 40%, effectively increasing the value of that plan by 40%.)
  • If no advice taken, the result would be Mrs Nicholls would have pension fund of £100,000 but no Guaranteed Annuity rates. GARs on Pension 4 would be lost. Mr Nicholls would have pension fund of approximately £92,000 after MVA applied.
  • Both would have lower pension incomes
  • Advice is obtained from a Resolution accredited specialist adviser
  • State pension “substitution” is undertaken via Scrutton Bland

Financial Needs and Cash Flow

Financial Needs and Cash Flow Analysis

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