Client story: Trust, support and the value of financial advice in difficult times

When Louise first took financial advice, it was with a view towards securing her family’s long-term future. She couldn’t have known how dramatically the shape of that future would soon change.

In 2014, Louise and her husband, Andy, were in their mid-forties, with two young children and a desire for financial peace of mind. They sought guidance from their St. James’s Place Partner about paying for their children’s education, helping them out with weddings and first-home deposits when the time came, and the best way to deal with shares that Andy received when his employer went public.

Then, in November 2015, Andy was diagnosed with non-Hodgkin’s lymphoma, a type of blood cancer that affects the lymphatic system.

“It is considered one of the most treatable and curable cancers, plus he was relatively young and very fit,” Louise recalls. “Unfortunately it manifested itself as a tumour strangling his spinal cord, which affected his mobility. We believed for some time that he would come out the other side of it, even if he wasn’t the same person or able to do the same things.”

Andy was 44 at the time, was a keen sportsman with a passion for cycling and had no previous symptoms of the condition.

Focus on future-proofing

The advice Louise and Andy initially received addressed the aspirations characteristic of a family with young children. Using cashflow software, Louise’s Partner worked with them to map out how their finances could be arranged to meet their goals.

“At that point it was really about making sure we would be comfortable, that we would be able to look after the kids and generally feel like we had our ducks in a row,” Louise explains.

When Andy was diagnosed, they refocused on ensuring that Louise and the children would be financially looked after if the worst were to happen.

The first mortgage the couple had taken out was an endowment policy, with critical illness insurance included. Louise had continued to work full-time in the wake of the diagnosis, but the payout from the insurance allowed her to give that up in order to look after Andy and concentrate on the children.

“When he was first diagnosed, I carried on working full-time,” Louise says. “I was going to hospital in Stoke every day – coming home from work, feeding the kids then going to hospital. I’ve no idea how I did that.”

With their St. James’s Place Partner, the couple checked that their existing life insurance policies were written in trust; they used some of the critical illness policy proceeds to maximise Andy’s personal pension contributions. By using his annual allowance in the current and previous tax years, he was able to benefit fully from higher-rate tax relief.

Support and peace of mind

In early 2017 came the news that Andy’s condition was terminal. The priority now was to give Andy peace of mind – that Louise and the children would be taken care of once he had gone, and that she would not have to work if she didn’t want to.

Louise says her Partner looked after these practical financial issues in what was an emotional situation, giving the couple space to spend precious time together as a family without having to stress about their finances.

“We were speaking quite regularly,” Louise recalls. “She was incredibly accessible, very appreciative of our situation and made herself available."

“We needed a detached approach so that we could focus on Andy and not have to worry about money. I can’t imagine what it’s like having someone that poorly and having to make ends meet. She took that worry away from us, and we trusted she was doing the right thing.”

That included addressing a significant Capital Gains Tax liability that would arise from share sale proceeds from Andy’s employer, paid out in July 2017. “My Partner came into her own and structured things,” Louise says. “The first lot of shares Andy received were done in very tax-efficient way, but the second lot were much more complex. She was very practical given a very delicate situation.”

Andy’s pension arrangements needed attention too, specifically a defined benefit (DB) pension with a previous employer.

With the knowledge that Andy would not reach retirement age, it was decided to sacrifice the guaranteed income from the DB arrangement and transfer the pot into a private pension. This meant that Louise could later receive the full pension tax-free, or pass it on to the children on her death if she didn’t need it.

Someone to lean on

By this time the focus was on making sure that everything possible could be done to ensure the family would be financially comfortable when Andy had gone. Being able to trust their Partner played a big role in that, says Louise.

“I’m very much of the opinion that, as the adviser, she is the expert and I can trust her with the detail of it. It must have been difficult for her, as she knew us both – having those hard conversations when we found out that Andy wasn’t going to get better. She was always very supportive, and continues to be.”

Andy made it to Christmas 2017, passing away shortly afterwards with his family around him. By that point the financial foundations for the family’s future had been laid, leaving Louise and the children space to grieve knowing they were financially secure.

The life policy was claimed on, probate applied for and funds gathered from Andy’s pensions, while Louise’s Partner also introduced her to an accountant to help with paperwork and other requirements.

“I didn’t have to worry, because I knew my Partner had it covered,” Louise says. “I wouldn’t have got through it without her. I wouldn’t even have known where to start, even though I have a banking background.”

Having worked in the financial services industry, Louise – who works for DKMS, a blood cancer charity – already understood the value of financial advice. Her experience since 2012 has given her a whole new appreciation.

“I honestly believe that without it I wouldn’t be in the position that I’m in now and that it would have been a lot more stressful,” she says.

“It has made me feel safe, and that’s massive, because I’m on my own now.”

St. James's Place Partners work closely with you to create a plan that is individually tailored to meet your needs, and adapt it to your changing circumstances. Get in touch today to find out more.

The advice given to Louise and Andy was provided after a full evaluation of their specific needs, circumstances and requirements and was correct at the time it was given. The solutions provided may not be suitable for everyone and the information provided here does not constitute advice.

The value of an investment with St. James's Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up. You may get back less than you invested.

The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief generally depends on individual circumstances.

Trusts are not regulated by the Financial Conduct Authority.

This is just one client’s story and each situation is unique. The advice provided was given after a full evaluation of their specific needs, circumstances and requirements and may not be suitable for all clients. Always seek professional financial advice before making any decisions.

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