Post Retirement – Active Years


Bob and Kit have recently turned 70 years old. They have been retired from age 65, and want to make the most of the active years of their retirement. They enjoy looking after their grandchildren and travelling, often taking interrail trips across Europe and holidaying in England with their family.

They would like to review their existing investment plans and see if they can afford to take two long haul trips within the next five years to Australia where Bob’s brother and sister live. They appreciate in later life travelling long distances may become more difficult and want to make the most of the opportunity now

key client considerations2

Bob and Kit have a joint retirement income of £40k p.a. (before tax), from Teacher’s Pensions and their State Pensions. They have a portfolio of stocks and shares ISA’s valued at £120k which was setup by a previous financial adviser (now retired), £30k in savings, and their family home is valued at £500k.

To fund the long-haul trips, they would need to access their stocks and shares ISA’s but Bob and Kit are concerned that this will leave them short of money in later life for things like care costs.


We started by reviewing Bob and Kit’s stocks and shares ISA’s and explaining the underlying investments, risk and performance. We concluded the investments remained suitable and we agreed to take over reviewing the plan on a yearly basis.

Using our cashflow modelling software we showed Bob and Kit they could afford to draw £20k for their long-haul trips from their investments whilst retaining their long term financial security.

Looking to the future we explained that the cost of care varies depending on your needs. For example, if residential care is required the cost would typically start at £35k p.a. However, the cost for care in your own home is significantly less and could be met from their pension income.

We explained that based on current rules the family home could not be sold if one of them required care, because the other would still need somewhere to live. In addition, only savings in the name of the person requiring care would be assessed.


Bob and Kit were pleased to know they could make the most of their active retirement years.

Whilst there is no guarantee that the Care rules won’t change in the future, or their family home won’t one day be included in a financial assessment, Bob and Kit were reassured that they are more financially secure than they thought.

We confirmed they had no inheritance tax liability, which Bob and Kit had not thought about. We highlighted their need to make a Will because they want to leave everything to each other, and then their children. Without a Will, the surviving spouse would only be entitled to the first £250k, with the remainder split between the children and surviving spouse. In addition, as the family home will ultimately be left to their children, they would qualify for the new Residence nil rate band allowance, increasing their IHT allowance to £1m by April 2020.

We put them in touch with local Solicitor to draft their Will.