Private Client Case Studies

The following case studies relate to actual examples where we have helped our clients by providing solutions to their
financial problems. These examples are representative of both our clients and the issues they face. Whilst they are
actual examples, all personal details have been changed for confidentiality purposes.

P r i vat e C li e n t C as e S t u dy 1
Mr & Mrs Jones are married with three children aged 20, 24 and 27, two of which are already in highly paid executive
management positions in London. Mr Jones is retired and Mrs Jones is presently employed and self employed, both
are higher rate tax payers.Total value of their estate is £2,100,000 of which £900,000 falls into the categorisation of
‘investable assets’ and they also have disposable income of approximately £20,000 per annum.

The problems they had before we got involved...

• They had an Inheritance Tax liability of £580,000 and had no structured estate/generation plan.
• Their annual ISA and Capital Gains Tax allowances were not being maximised and they had unrealised capital
gains of £100,000 in their current overall portfolio.
• They had several investment providers creating an administration burden and growing difficulty in monitoring
their portfolio, which had partly caused it to become out of sync with their risk profile and investment objectives.
• They lacked diversification and had direct equities/shares, which they had lost track of.
• A general dissatisfaction with advisor/client relationship and a feeling of lack of coherency and sophistication with
their planning and as a consequence a loss in confidence of the robustness of their existing provider’s proposition.

The solutions we helped them to implement...

• We were able to carry out a thorough analysis of their existing circumstances and concisely understand their
financial objectives and future plans and assist them in putting together a well structured and well thought
through robust financial plan, providing them with lots of flexibility as their circumstances change in the future.
• Where feasible and in the best financial interests of the client, the investments were streamlined in order to
simplify the administration.
• As a result they now enjoy significantly less administration and are confident their finances are being managed
under a robust proposition with the necessary ongoing monitoring.
• They now maximise their ISA and Capital Gains Tax allowances annually.
• Their investment portfolio now also includes some Inheritance Tax efficient vehicles ensuring that all future
growth does not form part of their estate for Inheritance Tax assessment purposes, this includes a structured
gifting strategy over the next 20 years.
• We helped to mitigate a total of £55,000 in tax immediately and will save a further £40,000 by using one of our tax
specialist investment vehicles within their portfolio whilst also solving their unrealised Capital Gains Tax problem.
private client case studies mercer & associates wealth management

• We recommended a trusted well qualified Private Client Lawyer who has drawn up new asset protection wills
providing various benefits. One of the prime benefits is that the trusts can last for up to 125 years and therefore
Mr & Mrs Jones wealth will never enter their children’s estate and be assessable to Inheritance Tax again on
the children’s death (i.e. skipping a generation). Lasting powers of attorney have also been drawn up and duly
registered with the court of protection.
• An existing life policy and pension have been written in trust saving a further £85,000 in Inheritance Tax.
• A whole of life policy has been put in place and written into trust to provide a fund to pay the remainder of the client’s
Inheritance Tax bill on death, this uses their annual gift allowance, which they were not previously utilising at all.
• Regular contribution pensions were also put in place (parent funded) for each of their children as a gift from
their normal expenditure. The contributions attract 20% Income Tax relief and because the money is being
gifted out of their estate they also save a further 40% Inheritance Tax.

Post becoming a client...

• We meet every 4-6 months to review all of their affairs and have undertaken conference calls with the Director
of Asset Management during volatile times.
• They are provided with a variety of information regularly to keep them up to date with various different aspects
of the financial world.
• They have attended two of our Exquisite Fine Dining Experience events and have heard from some of the
country’s leading Wealth Management experts including Fund Managers who manage some of their money.
• They have access to portfolio valuations online 24/7.
• We have an excellent and well founded relationship and the clients feel they can contact us whatever they
require and we will also respond efficiently and accurately with informed opinions backed up by St. James’s
Place Wealth Management.

The value of an investment with St. James’s Place will be directly linked to the performance of the funds selected and
may fall as well as rise. You may get back less than the amount invested. The levels and bases of taxation and reliefs
from taxation can change at any time and are generally dependent on individual circumstances.
Wills and Powers of Attorney involve services which are separate and distinct to those offered by St. James’s Place.
These along with Trusts are not regulated by the Financial Conduct Authority.
private client case studies mercer & associates wealth management

P r i vat e C li e n t C as e S t u dy 2
Mr & Mrs Smith are married with no children and have savings and investments totalling £450,000 with 18 different
accounts/products with varying providers. Mr Smith is a high rate tax payer and Mrs Smith is a non tax payer.

The problems they had before we got involved...

• A significant administration burden and they didn’t actually know who was managing some of their money
or which company it was with due to changing fund managers and company buy outs over the years.
• They weren’t using any of their tax allowances and Mrs Smith was paying unnecessary tax.
• They had a significant amount of their funds in cash based deposits bearing exceptionally low interest rates.
• They were very unhappy with their existing investment managers and had experienced having 7 different advisors
over a 6 year period due to clerical changes and redundancies with the organisation, which managed their money.
• They felt their existing advisors lacked competency and a good understanding of the financial markets and
also were of the opinion an overall coherent strategy was lacking and the solutions were not to hand with
their existing providers. They also felt they had experienced product selling in the past.
• They required guidance and someone helping them to put their affairs in order.

The solutions we helped them to implement...

• We have successfully managed to triple the level of investment income the clients were provided before.
• The clients are very assured that their investments and the fund managers managing their money are being
constantly monitored and changed where necessary.
• The clients are now fully aware of who is managing their money and when changes occur.
• They have saved tax by appropriately distributing their investment portfolio.
• They have significantly reduced their administration.

Post becoming a client...

• The clients desire minimal information. They want to have one review per annum to ensure the financial affairs
remain on track.
• They have access to the wide range of ongoing communication and advice services as detailed in Case Study 1.
• The clients feel they have put all of their affairs in order and now have the peace of mind in knowing that their
wealth is being properly managed and are enjoying more holidays as a result of their additional investment income.

The value of an investment with St. James’s Place can fall as well as rise. You may get back less than the amount invested.
Equities do not provide the security of capital which is characteristic of a deposit account with a bank or building society.
The levels and bases of taxation and reliefs from taxation can change at any time and are dependent on
individual circumstances.

P r i vat e C li e n t C as e S t u dy 3
Mr & Mrs Roberts are aged 66 and 65 and are both retired with two
grown up children and one grandchild. They have pension income for
their mandatory expenditure requirements but desired to generate more
income to pay for holidays and trips. Following a pension lump sum
upon retirement they had cash of £120,000 in their savings account not
earning any real return and depreciating in real terms when taking into
account the impact of inflation. Their interest rate was 2.1% per annum.
private client case studies mercer & associates wealth management

The problems they had before we got involved...

• They were generating little income and inflation was eroding the value of capital in real terms.
• Their interest income was taxable.
• The effect of them drawing an income over time would have significantly eroded their capital sum.
• They had several bank accounts and were worried if something happened with them that their family
would not know who to liaise with.

The solutions we helped them to implement...

• We helped the clients to design a bespoke portfolio, which met their attitude to risk and investment time
horizon, which was diversified over several different Fund Managers from all over the world.
• As the clients are retired and have a relatively cautious attitude to risk we built in a stable base of fixed interest
and bond assets into the portfolio in order to minimise/control the volatility.
•  We successfully increased the clients “income” from 2.1% per annum to 6.2% per annum (averaged and variable).
• As they invested £100,000, we increased their income from £2,100 per annum to £6,200 per annum.
We also ensured that the income they received was tax efficient and did not affect/reduce their age
related personal allowances.
• We recommended they review their will and protect their main home and other assets against the possibility
of them needing to go into care in the future.
• We completed a St. James’s Place “My Documents” with them ensuring that they have a record of all of their
affairs in one place for them and their family.

Post becoming a client...

• The clients now enjoy all of the benefits and services associated with being a client of Mercer & Associates and
St. James’s Place Wealth Management.

The value of an investment with St. James’s Place will be directly linked to the performance of the funds selected and
may fall as well as rise. You may get back less than the amount invested.
Equities and bonds do not provide the security of capital associated with a deposit account with a bank or building society.
Wills involve a service which are separate and distinct to those offered by St. James’s Place and are not regulated by the
Financial Conduct Authority.

P r i vat e C li e n t C as e S t u dy 4
Mrs James is aged 32 and single with no financial dependants earning £110,000 net per annum as a self employed
Barrister. She has no pension and £40,000 on cash deposit and wants to make tax efficient provisions for the future.
She currently has disposable income of £2,000 per month

The problems she had before we got involved...

• She is aware that because her income exceeds £100,000 she is in a 60% marginal rate of tax and she is keen to
mitigate this problem.
• She has no structured financial plan and is not taking advantage of tax allowances.
• She has a life policy of £300,000, which would have an effect of creating an Inheritance Tax liability in the event
of her demise and her family do not have funds to pay the bill.
• She is currently suffering poor returns on her cash deposits and given her tax position, the value of her capital is
depreciating in real terms at a significant rate.
 The solutions we helped her to implement...

• We arranged for her life policy to be written into a Discretionary Trust so that in the event of her death, the
proceeds would not form part of her estate for Inheritance Tax purposes. This has eliminated the tax liability.
• We arranged a pension contribution of £1,000 gross per month. As this is equivalent to £12,000 gross per
annum, it will mean that she will artificially reduce her income (technically increasing her Personal Allowance).
This means that she reduces her tax rate from 60% to 40% and she benefits from tax relief on all contributions
at her highest marginal rate of income tax. It only actually costs her £4,800 net per annum to get £12,000
gross into her pension because of the tax reliefs available. The pension will provide a tax efficient environment
for any growth achieved and this has also been written into trust to ensure the fund value does not create an
Inheritance Tax burden on her unfortunate demise.
• We arranged a regular contribution ISA of £940 per month to ensure that her annual allowance of £11,280
(2012/13) is maximised annually.
• She invested £20,000 as a lump sum into a unit trust in nil yielding funds ensuring no Income Tax is payable on
dividends. The growth in the investment will be offset against her annual Capital Gains Tax allowance to achieve
tax free growth.
• All investments have been structured in a suitable portfolio to meet her risk appetite and objectives of achieving
long term capital growth.

Post becoming a client...

Mrs James enjoys all of the services of Mercer & Associates &
• 
St. James’s Place Wealth Management and feels comfortable that
she now has a structured financial plan, which is consistently
monitored and reviewed regularly.
• 
She enjoys access to her portfolio online 24/7 as well as various
sources of information to keep her up to date with financial markets
and fund performance.

The value of an investment with St. James’s Place will be directly

linked to the performance of the funds selected and may fall as well as
rise. You may get back less than the amount invested.
Equities do not provide the security of capital characteristic with
a deposit account with a bank or building society.
The levels and bases of taxation and reliefs from taxation can change at any time and are generally dependent on
individual circumstances.
Trusts are not regulated by the Financial Conduct Authority.

Linenhall House, 88-90 Watergate Street,

Chester, CH1 2LR
Tel: 01244 409610 Fax: 01244 409611
Email: info@mercerandassociates.co.uk
Partner Practice of St. James’s Place Wealth Management Website: www.mercerandassociates.co.uk

Mercer & Associates Wealth Management Ltd represents only St. James’s Place Wealth Management plc (which is authorised and regulated by the Financial Conduct Authority)
for the purpose of advising solely on the Group’s wealth management products and services, more details of which are set out on the Group’s website www.sjp.co.uk/products.
The ‘St. James’s Place Partnership’ and the titles ‘Partner’ and ‘Partner Practice’ are marketing terms used to describe St. James’s Place representatives.