Client Scenarios

The key to navigating change successfully is to know what life you want to create. You can get by just fine with a traditional financial plan if you are simply continuing to move in the same direction. Career changes, loss of a spouse, even retirement require more than a simple projection. We created Athena Legacy Solutions with a focus on developing life visions for people approaching a change, and showing them how to use that vision to make better financial decisions today.

We have compiled a few hypothetical client scenarios to illustrate how our Life Vision Process can help clients to realize there unique Life Vision. Do any of these situations resonate with you?

Career Change

A highlyjanet1_0003_janet_0006_Website-ClientStories-CareerChange paid executive in her mid-40s wants to get off the “corporate treadmill” and reclaim her “life”. She wants to know if she could switch careers moving from the corporate world to working in the non-profit sector. She estimates that her income would drop by over $300,000 per year. She wants to know if and when she could plan to make this “life” change, while still meeting her financial goals of purchasing a home and retiring at age 60.   

We would talk about where she wants to live and what type of home she wants to purchase. We establish a budget for the down payment and the mortgage. We conservatively estimate her new salary, continued savings contributions and growth of her portfolio. Through the Life Vision process, we would develop “what if” scenarios to give her an idea of several possible outcomes, and what was needed to accomplish not only her immediate goals, but her long term goal of retiring early. The end result we would aim for is to determine the best time to make that career change without compromising her goals, maybe delaying it a couple years if it meant the difference between success and failure. We may even offer our opinion about what kind of salary and benefits she should look for in a new career. The idea is to help design a complete picture for her to aim for and not just talk about investments and numbers.

Disabled Child

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Let’s say a couple wants to retire as early as possible and move closer to the group home their adult disabled son lives. Maybe when their son was small he was in a group home close to where the family lives but needs to move to find an adult care facility capable of addressing his needs. The family’s “Life Vision” might be to semi-retire early and move closer to their son to spend more time with him.   

 We would develop a vision of life in a new town, less working, while still preserving security for the future. We would discuss the husband transitioning to part-time employment partly for the income and partly to retain medical benefits until Medicare could kick in. We can determine when to apply for Social Security to maximize survivor benefits for the wife. We would talk about renting versus buying a new home.

We would be actively involved with an Estate Planning attorney and attend each meeting with them. We would review their special needs trust to see what may have changed in their situation that would require updating the instrument. An outdated Special Needs Trust might make their retirement accounts immediately taxable at their death, thereby reducing significantly the money available to their disabled son. We work with the clients and the Estate Planning attorney to correct problems like this, which may involve creative solutions like adding the disabled son of another family as a beneficiary. The Life Vision process not only gives families like this an opportunity to better provide for and spend more time with their son, but the fulfillment of knowing they could help another family as well.

Retirement

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A couple in their mid-70s was referred to us earlier this year. The husband had been working part time in retirement, and his position was being eliminated.    They were very concerned about not having the additional income.

As we walk them through our Life Vision process, we will discuss where they wantto live, quantify their living expenses and discuss how their resources could be used to generate additional monthly income. Through the process, we may find that they cannot afford to stay in their current home and expect their resources to last the rest of their lives. The Life Vision process will give them the confidence to list their home for sale, and establish a new budget for purchasing a smaller home, without a mortgage, and invest the remaining proceeds to supplement their income and desired life style.

Travel in Retirement

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Consider a couple in their mid-60’s that own a business and how we might help them design a “Life Vision” of travel after retirement. All they had known for years was working their business and not being able to get away. Through our planning process we would envision what kind of travel they want to do, how often, and  what kind of resources are necessary to enable them to have this lifestyle.

We might discover that they only needed to average a 4% return on their investments to achieve their goals. Even better, we may discover we could fund that lifestyle while reducing the risk on their investments significantly by restructuring their portfolio.

Purchasing a New Home

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Picture a young suburban couple wanting to change their lifestyle to better suit their values and their growing family. However, let’s say the economy had just experienced a devastating recession and the housing market decline left them owing more on their mortgage than their current home was worth.

 Through our “Life Vision” process we would help them to visualize what they were looking for in a new life: a rural setting, farm animals, and plenty of room to accommodate growing children and family gatherings. They may be anxious about how they would come up with the money to pay off their existing mortgage and have a down payment on the new home. Through the “Life Vision” process we would evaluate options like temporarily reducing contributions to retirement and educational accounts: and tapping into their emergency reserves enabling them to create the life they wanted now with only minor changes to their long term goals.  Resuming their normal savings contributions after the move and gradually increasing them over the next 20 years, they may still be able to stay on track for their goal of retiring at 62.   

The “Life Vision” process may give clients like this the confidence to sell their home at a loss,  to see how purchasing a new home could be accomplished and what they would need to do to get back on track with their education and retirement goals. With luck, we may be able to help them settle into their dream home, with plenty of space for family gatherings, and farm animals.

Unexpected Widow

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The loss of a spouse is devastating and overwhelming. A woman who had just lost her husband unexpectedly at age 56 came to us very overwhelmed, not knowing what she needed to do to bring some sense of organization and stability to her financial situation. Her late husband had been the primary wage earner of the family, and taken care of most of the finances and investment decisions.

With a client like this, we would go to the woman’s home. We might spend days with her, going through files and papers, taking an inventory of assets and liabilities, identifying sources of assets like life insurance policies. We would help her by contacting the husband’s employer ensuring that we did not overlook any potential death or pension benefits she may be entitled to.

We carefully help clients like this start to envision a life without their spouse and to prioritize their needs and long term goals. We work to ensure that as they go through the Life Vision process they have the income needed to maintain the home and pay the bills. But most of all – we listen and take our time. We understand that the period following the loss of a spouse is not the time to be making major decisions. The process of building a new Life Vision takes several months. We educate and empower along the way to give the client the confidence to make decisions and take control of their future.

Inheritance at a Young Age

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Remember when you were in your early 20’s?  Having just graduated from college, starting a new career, and contemplating marriage? Not a care in the world…life is good. Now imagine suddenly losing a parent and inheriting half a million dollars…or suddenly inheriting an uncle’s remaining lottery winnings at his passing.  How would your life change? 

Most people believe that having more money is a good thing. And it is – to a point. The records of lottery winners and kids who inherited significant wealth young paint a different picture. Most who have experienced it tell a story of being overwhelmed, making reckless decisions, and ultimately losing it all.

You’ve never handled real money up to this point in your life. Your only experience has been a part time paycheck to help your parents pay for college tuition and books, and applying for student loans.  You’ve only saved money in a bank account, you’ve never invested before.

Suddenly, you have to manage a significant estate. Where do you begin?

Through our “Life Vision” process, we have several conversations with our young clients, helping each of them to envision a life plan for their immediate future by buying a house and paying off school loans. We show them how to take a little out at first to spend on something fun. More important, we help them to see past their immediate wants and desires, and to envision having a family with children, and eventually planning for their retirement.

We help these young clients to understand the value of leveraging assets when purchasing a new home, by putting down a reasonable deposit and obtaining a low interest mortgage. Throughout the process, we educate them on the fundamentals of investing, helping them to create a strategy that would take them through the various phases of their life; as well as starting a longer term retirement savings strategy. 

We make sure that the implementation of a “Life Vision” is flexible to adapt to their changes that would occur in their lives going forward.

We coordinate with legal counsel to protect assets by establishing a trust for their inheritance and discussing the benefits of a prenuptial agreement prior to walking down the aisle. We also work with Property Casualty Brokers to ensure they had adequate liability insurance on their home and auto.  

Sudden wealth, ironically, can be devastating. Our life vision process helps young people embrace the opportunity, overcome their impulses, learn what they needed to know to manage their estates, and lay the groundwork for a successful adulthood.

The examples provided are hypothetical scenarios to represent a potential situation and any resemblance to an actual person is completely coincidental.