Client Profile:

• Ages: 55 and 57
• Recent Liquidity Event: £12 million from selling a long-held family business
• Goal: Diversify holdings, ensure long-term financial security and incorporate philanthropy while maintaining a stable annual income stream

Initial Challenge:

Following the sale of their family enterprise, the couple needed guidance on how best to deploy their £12 million lump sum. They sought to reduce investment risk, balance income and capital growth, implement tax-efficient structures and establish a philanthropic legacy. With no prior experience managing investments of this scale, they required comprehensive strategic advice.

Our Approach and Outcomes:

• Holistic Wealth Assessment and Investment Strategy
We conducted detailed scenario modelling to determine sustainable withdrawal rates and long-term income targets. We recommended a portfolio allocation of 50% equities, 30% bonds and 20% alternative assets. This aimed for an annual return of 5–5.5% with manageable volatility. Within the first year, performance hovered around 5.1%, reinforcing expectations.

• Tax-Efficient Structures and Estate Planning

By setting up a series of trusts and investment wrappers, we helped reduce their effective tax rate on income and gains. This planning is projected to save approximately £30,000 per year over a 20-year horizon. We also worked with legal advisers to ensure their estate plan provides clarity and reduces exposure to inheritance taxes.

• Philanthropy and Legacy
We allocated £500,000 to a Donor-Advised Fund, facilitating annual charitable grants of roughly £25,000. This allowed them to support causes they cared about and instil family values of generosity, all while gaining tax advantages.

• Risk Management and Liquidity Provision
We recommended holding £500,000 in readily accessible low-volatility funds for unforeseen expenses and opportunities. This liquidity reserve reduced pressure on long-term investments during market downturns or personal emergencies.

Result:

After structuring their portfolio and implementing tax and estate strategies, the couple enjoys peace of mind knowing their wealth is well-managed. They have a sustainable income stream for their desired lifestyle, reduced tax burdens and a clear framework for passing wealth to future generations. Their philanthropic fund has become an integral part of their legacy. Regular reviews ensure their strategy evolves with their needs and changing market conditions.