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3 life transitions where your clients could benefit from financial advice

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Life transitions such as getting divorced or taking a career break often trigger changes in an individual’s financial circumstances, needs, and aspirations.

Whether your clients are experiencing a planned life event, such as selling their business, or an unexpected transition, such as coping with the loss of a loved one, they may benefit from professional financial advice.

Read on to learn about three life transitions that a financial planner could help your clients navigate with confidence.

1. Preparing for a career change or a break from paid employment

According to figures published by StandOut CV, the average British worker changes jobs every five years and 1 in 10 adults in the UK have swapped careers in the past 10 years.

There could be many reasons why your clients decide to revamp their professional lives. For example, the arrival of children or grandchildren might drive them to pursue a better work-life balance. Alternatively, new parents might decide to take a career break to spend more time with their families.

Whatever is motivating your clients to change or pause their careers, this transition could have significant financial implications such as:

  • A reduced household income – If your client accepts a lower-paid role or takes a career break.
  • Disruption to retirement plans – If your client is unable to continue contributing to their pensions, savings and investments.

Fortunately, we can help your clients prepare for this life transition by using cashflow modelling to show your clients how their income and needs might vary across different financial scenarios, such as a drop in salary or period out of paid employment.

We can then adapt their financial plan to account for their changing circumstances. For example, by increasing their pension contributions in the years leading up to their career change or break, or investing to provide an additional income stream.

2. Navigating a divorce

Going through a divorce or the dissolution of a civil partnership can be a stressful and emotionally overwhelming time.

This life transition could also present your clients with financial challenges that they may find hard to navigate.

In fact, your clients could be at risk of overlooking key financial elements of their divorce altogether, if they fail to seek professional advice.

Data released by the Institute and Faculty of Actuaries (IFOA) and Scottish Widows, published by the Standard, has revealed that only 30% of divorcing couples include pensions – often one of the most valuable assets an individual owns – in their financial settlements.

So, a financial planner could play a key role in helping your divorcing clients achieve a fair settlement by:

  • Reviewing their shared finances
  • Providing an understanding of their current and future financial needs
  • Using cashflow modelling to explore the financial implications of different settlement options
  • Creating a financial plan that aligns with their post-divorce needs and goals
  • Offering empowering and confidence-boosting ongoing support.

Read more: 5 of the most-overlooked financial elements of divorce

3. Selling a business

For clients who have spent years building their businesses, selling up and moving on is likely to be a significant transition that requires careful planning.

They’ll need to think carefully about when to sell, how to prepare their business for sale, and what type of sale to pursue. Your clients will also need to consider how exiting their business could affect their personal finances in the short and long term. This means having a solid grasp of the numbers.

That’s where we come in.

Engaging a financial planner early in the exit process could help your clients to:

  • Understand the value of their business
  • Manage the tax implications of selling
  • Identify their personal goals and ambitions for the sale and beyond
  • Create a personal financial plan for their future after exiting their business.

This support could allow your clients to achieve a smooth transition, whatever their future plans are, be they to retire, start a new business, or move into a new career.

Get in touch

If you have any questions about how we could support your clients as they navigate important life transitions, please get in touch.

Email hello@sovereign-ifa.co.uk or call 01454 416653.

Please note

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.

All information is correct at the time of writing and is subject to change in the future.

Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

The Financial Conduct Authority does not regulate tax planning.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

Approved by Best Practice IFA Group 15/01/2025

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