Client Case Study – Rob and Amanda

Names:

Rob and Amanda

Age:

57 and 62

Employment status:

Both full time

Occupations:

White collar workers

Initial case notes:

• Professional couple
• Both in good health
• Small cash balance
• Own primary residence outright
• Strong superannuation savings
• No other investments

Why did Rob and Amanda seek help from Jubilacion?

Rob and Amanda were motivated to retire by the time Rob turned 60. They had discussed their retirement plans in depth in order to set themselves up for an early retirement.

However they were cognizant of their limited knowledge about the of government rules around savings and superannuation. This made them uneasy – they knew they needed some assistance in this area to find out if they were on track to meet their retirement goals.

What questions were Rob and Amanda seeking help with:

• Could they retire when Rob turned 60 and still meet their retirement spending goals?
• What would be the impact of downsizing their home and releasing equity?
• What were the implications if they spent more early in retirement, then less later on?
• How much did they need in super to be confident of meeting their retirement goals?

Baseline results:

Jubilacion found that if Rob retired at 60, he and Amanda would be short of reaching their goal retirement spend safely.

We explained that our ‘Safe Spending’ figure is set to a 95% confidence level. In other words, 5% of the thousands of scenarios we tested showed Rob and Amanda running out of money while they were still alive. This could be considered a conservative approach and, if markets performed reasonable well, Rob and Amanda could feasibly spend more than this. Jubilacion identify this amount in our modelling. We call it ‘Variable Spending’. Taking into account the Variable Spending figure, Rob and Amanda found they were much closer to their target retirement spend (but they would need to forgo the Variable Spending amount if market performance was poor).

Using our inbuilt Age Pension calculations, we estimated that Rob and Amanda would start to become eligible to receive some Age Pension income in around 15-20 years time.

Being very focused on their goals, Rob and Amanda threw themselves into testing some different scenarios to see if they could get their Safe Spending closer to their goal.

Scenario testing:

Rob and Amanda opted to test 2 scenarios:

1. What if they spent more in their ‘active’ phase of retirement until age 75? How would this affect the amount they could live off after age 75?
2. How much super would they need to have in place at age 60 in order to be confident of affording a $75,000 annual spend in retirement?

Jubilacion provided their results in the Advanced Financial Freedom report.

Conclusion:

Here’s what Rob and Amanda thought of the Financial Freedom service:

“Jim made it very easy for us. He listened carefully to what we wanted from Jubilacion and was able to answer our questions effectively and efficiently, both by email but also via our face-to-face conversations.

Jubilacion offers a service that many people require but do not know how to articulate or where to obtain this information. It is a great tool for pre-retirees who do not require the whole gamut of information rovided by Financial Advisers but just want to ensure that they are on the right path in terms of living a comfortable retired life.

If more people knew about Jubilacion’s services, they would not need to go to expensive advisors who actually provide more information about investments and less information on how your money can work for you in your retirement.”

Whilst the results of our calculations don’t always show clients can meet their goals, we love it when they do. Being able to provide people with peace of mind around one of life’s more stressful decisions is a privilege we don’t take for granted.  

Does this sound like you? Jubilacion can help!
Get in touch with our friendly staff today and find out how we can provide answers to your unique retirement questions.