Challenge:  Our clients had already retired thinking they could simply invest in bonds or CDs and be safe, but came to us when they realized they had no control over the direction of interest rates. 

Result:  Prime Wealth’s multi-disciplinary team helped them find tax-saving strategies, and put part of their assets in structured products so they could have a dependable income no matter what direction interest rates or the markets went. 

Our clients, former business owners, had sold a very profitable small business and retired in their mid-50s when they came to Prime Wealth.  They had planned to put the majority of their money in fixed-income investments like bonds and term deposits to help them generate a stable income.

Unfortunately, the market didn’t cooperate.  First, they had experienced losses in 2008 which had lessened the assets they had available.  Then, over the past years, both bonds and term deposits were paying next to nothing. So the couple was unsure what to do.

They had talked to two financial advisors their friends recommended, but most seemed to focus primarily on investing.  Since they were relatively young but already retired, they didn’t want to make any more mistakes so needed to find a solution that worked.  They called Prime because they liked the fact that we offered retirement planning along with tax and estate planning.

Our advisors worked with the couple to first analyze all their assets and discover how much they needed to pay for their desired lifestyle.  We met with them several times to gather more information and help clarify their goals.  From there our financial advisor, accountant and estate planning attorney met to discuss their situation, and came up with a proposed strategy:

• They would implement two tax strategies we identified to free up more cash
• We would convert a portion of their assets to a structured product that would guarantee them a fixed monthly amount, that would pay for their monthly expenses
• A portion of their assets would remain invested in stocks, to help them still achieve growth, now that their monthly costs were funded
• They would wait and file social security later, which would increase the amount expected, and that money would be used to fund their future health care costs
• An estate planning strategy was created that would shelter most of their assets from any potential creditors, as well as save them tax money now (and later, save their heirs’ money)

We presented this to the clients, and they agreed to implement it.  This new strategy allowed them to sleep soundly at night no matter what interest rates and the market were doing.  They still meet with our team on a regular basis and we do routine tax planning to make sure they are minimizing their tax liability.  In addition, our team also handles all their tax preparation, keeping things simple for them.