The Good, The Brave – Financial Advice to Creative Individuals in the Design Sector
This week we revisit Chris Henley’s story – a freelance designer atwww.goodandbrave.co.uk who came to us for advice on setting up their retirement plan:
Chris came to us in 2014 with the intention of setting up a retirement plan.
The past 10 years had gone by far too easily without getting a pension plan in place and at the age of 36, Chris was very aware that he needed to get a pension set up sooner rather than later.
Chris is a self-employed/freelance designer. It is solely his responsibility to put a financial plan in place in order for him to be financially successful now and well into the future, i.e. long into retirement when he would cease working.
In order for Chris to enjoy an income when he stops working, Chris knew that he needed to start building assets now.
Chris had the plan of wanting to retire by 55-60 years of age and so we had just 20 years to get the full amount of retirement savings in place for him.
Chris needed assistance with calculating what the best way of investing would be for his specific situation. Then decide how much and how often to invest. This also needed to dovetail with his earnings, which could be irregular due to the project based nature of his work.
What we worked on and the outcome of our discussions
We set up a plan whereby Chris would make Pension contributions on a semi-regular basis, as and when he had the cash available. These would also be made in view of Chris’ earnings within the tax year to ensure he avoids paying as much higher rate tax as possible, despite his earnings being in the higher rate tax bracket.
We then set up a bespoke portfolio of funds for Chris to invest in via his new Pension. He now makes contributions twice a year, once in the Autumn when he has built up cash from the start of the tax year, and once in the New Year, when he is a lot clearer about what his earning will be in the tax year.
Financial Position in 2016
Chris has managed to accumulate a surprising amount in a short space of time and far more than if he had put things off until later. What is more, he has managed to invest while markets have been some way off their highs of late so he’ll benefit from buying low in years to come when markets rise.
For more information, please contact Jaskarn Pawar, Chartered Independent Financial Planner at Investor Profile.