Tom and Margaret were looking for help. Tom wanted to retire, after 35 years on the corporate ladder he was done. They weren't sure if they could afford it. Tom at 61 was 10 years older than Margaret. He was very concerned that she would outlive him and would she be ok if that happened. They were also somewhat risk averse.
When I showed them their cashflow chart first- with their ARF invested in cash- they were running out of money in their 70's. They were resigned to Tom working for 5 more years.
I then showed them taking a reasonable amount of risk on their ARF- the cashflow was transformed. The software worked out that Tom could in fact retire immediately if they got 4.5% growth rate on their ARF. They would not run out of money. Tom also wanted to know what would happen if he died early. We modelled what-if scenarios of him dying at 5 year intervals. If he died in the next 10 years there would be a problem but not if he died later than that. The software calculated that they would need an additional 200k cover on his life for the next 10 years.
They thanked me for the meeting and told me that they would come back to me but they were going to see another adviser first. I presumed that I had lost them as clients but I thanked them for their time.
To my surprise they called me 10 days later and requested another meeting. When we met, I asked them how the meeting with the other adviser went. They looked at each other and laughed. The other adviser while he had prepared very well also had no answer to their specific questions. He had printouts and a nice binder but had no insight into their problem. He couldn't tell them when they could retire or how much return they needed or what protection they should purchase. The advice was all too generic. They subsequently moved all their business to me and Tom retired. They have also been a fantastic source of referrals since.
Reflections: There is a real competitive advantage in using Voyant with clients. "Real time advice" makes it very hard for anyone else to compete with you. It saves hours, unnecessary meetings and enhances the quality of your relationships. The real implication of technology enabled lifestyle financial advice is incomparable to the finger in the air style of advice. If you went to an optician, would they guess what glasses you need? No. They would use technology to tell you exactly what you need with the aid of technology. This as an industry is where we need to move to.
Using technology to assist clients in making informed choices is the norm in other industries and Voyant is making this process change possible for many advisers in Ireland today.