Case Study
I had the wrong retirement plan –
based on the wrong assumptions
Introduction
Caroline, a 60-year-old solicitor, had built a healthy portfolio over her 30-year career. Her existing adviser assumed steady 6-7% returns and told her she could “just about” afford to retire.
Before
- Her financial plan assumed linear returns without accounting for risk
- She was told to stay working another 3 years to “be safe”
- She felt anxious about market corrections and their impact on withdrawals
- No stress testing had been done on her portfolio
After
- Understood the “retirement risk zone” and impact of sequence of returns
- Discovered she could retire now with a 90% confidence level in all scenarios
- Shifted to a volatility-managed portfolio designed for decumulation
- Moved from 6.5% expected returns to a safer 3.1% with no lifestyle impact
Process
- Delivered a Financial Health Check including stress testing for 2008 and Lost Decade
- Rebuilt her retirement plan using dynamic withdrawals and income flooring
- Reallocated assets to reduce volatility drag and drawdown exposure
- Reframed her perception of risk: prudence over performance
Conclusion
Caroline retired with confidence, not on the back of optimistic projections, but on a plan designed to withstand real-world volatility. She now sleeps better, spends freely, and worries less.