Case Study – David

David, age 63, contacted us in October 2011 for a review of his pensions. He had just suffered a TIA and with had other health issues, so he wanted to stop working as soon as possible, but could he afford to.

Again, his current income and expenditure was considered alongside when he would be eligible for State Pension and how much this paid.

His dream was to travel to China and Alaska before he was unable to travel and we established how much monthly income was needed going forward. His current income gave him £1,600pm of which they saved £500pm.

He had 5 pensions totalling over £200,000. We reviewed each pension and one had ‘Guaranteed Annuity Rates’ and another had the option to take more than 25% of tax free cash.

By ensuring that we managed to get the best results with each pension plan – consolidating some and taking the enhanced Annuity rate with another.

His wife Wendy only received a State Pension of £28pw. Once Dave was in receipt of his State Pension, Wendy’s State Pension as paid as a ‘Married Persons’ pension and increased to £64.40pw (rates for 2011/12).

The income was then:

  • Dave’s State Pension at £135pw 7,020
  • Wendy’s State Pension at £64.40pw 3,348
  • Guaranteed Annuity 3,142
  • Drawdown Pension 6,627
  • Total Gross Income £20,137p.a. £1,678pm

As well as this, he received almost £42,000 tax free from his pensions and used this money to easily fund his 2 holidays and give him an income for the 14 months until he received his State Pension.

Each time we meet to review his Pensions, he looks more relaxed and now spends time enjoying his grandchildren and his holidays. Without financial worries, his health has improved dramatically.

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