The company had an enquiry in 2021 from a husband and wife (business owners) clients aged 60 and 58 who were planning on retiring soon but were wondering if they have enough to last them as long as they live.
The business was going well, making average annual profits of €325,000. Both clients are very healthy (Above average health for their age), and they live off average wages for their profile.
The couple had pension funds valued at €978,000 with savings/investments valued at €325,000. The couple lived in a nice family home (Mortgage free) and one rental property (Mortgage free).
They wanted to retire in Ireland and purchase a place in the sun, with a budget of €500,000.
A few issues are:
- They want to know how to get the money in their Company (€1.3m approx.) out without paying a fortune in tax.
- The couple also liked the idea of staying on in the business; they like what they do but find they are working too hard.
- The clients have three adult children and would like to leave them as much as possible, providing them with a gift towards their deposit for a home in the near future.
From analysing their lifestyle and desired lifestyle in the near future, we agreed on how much it would cost and at what point it is likely to drop.
Without getting into details, Financial Architects showed them that they could access the entire business savings tax-free, access their pensions, and retire. Doing this also reduced their future inheritance bill to their kids, reducing their taxes. They were already Financially Independent and would not run out of money if they stuck to the plan we gave them.
The clients were amazed to hear they could also set up a new smaller business in the area they enjoyed most, and we helped them understand how to get any savings in the company back with a minimal tax rate.
As a result, the clients have not yet retired. They are seeking a buyer for their business, but they intend to retire in 2023.