Wealth Check: 'Can we keep our lifestyle after work?'

Each week we give 'Independent on Sunday' readers a financial makeover

The problem

Chris and Rosie Inge have worked and saved hard over the past 30 years. However, the couple are not sure if they've done enough to give them a comfortable retirement, as planned in seven years' time. "While our finances look reasonably 'sorted', they would not support a life after work at [our] current rate of spend," says Rosie.

Chris's interest in personal finance began in his 20s and accounts for much of the couple's savings. They have £53,000 with ING Direct earning 4.89 per cent, and invest £75 a month into a friendly society plan. A portfolio of shares and equity ISAs managed by stockbroker Gerrard is worth around £112,000 and they have also put money into two enterprise initiative schemes (EIS) that back small businesses (£25,000 in the Troubadour Café in London and £7,500 in Brazz brasseries, located in the South-west).

The Inges have a further £12,000 in a range of unit and investment trust equity ISAs, including Polar Capital Technology, New Star Technology and Schroder Medical Discovery.

The couple have a £31,000 interest-only mortgage with Alliance & Leicester. Midway through a four-year discounted stepped deal, they currently pay 6.43 per cent. Their house is worth around £500,000.

Last year, they slimmed a mixed bag of pension pots into two Standard Life self-invested personal pensions (Sipps); both contribute £300 a month.

Insurance comes through a whole-of-life policy (with Skandia Life) and simple term assurance (Scottish Equitable). If one were to die, the surviving partner would receive £130,000.

Both have income protection plans with Norwich Union, one of which is paying Chris £870 a month after he contracted the MRSA superbug following a heart operation five years ago.

The Inges owe £1,200 on a First Direct personal loan, taken out to pay for double glazing.

As security for their business, they have a separate £40,000 Skandia investment plan.

The patients: Chris and Rosie Inge, 58 and 56.

Job: owners of Churton Inge, an advertising and marketing agency in Wells, Somerset.

Joint income: up to £50,000 a year.

Savings: £53,000 in a savings account; £75 a month put into a Family Assurance Friendly Society savings plan.

Investments: shares portfolio, equity ISAs, EIS projects.

Goal: to ensure their retirement plans are on track.

The cure: Their money must double

If the Inges want to retire on a similar income to the one they have now, they need all their savings and investments to double in value in the next seven years, says Gill Cardy of independent financial adviser (IFA) Professional Partnerships. This is a tall order and the couple should be more realistic, she adds.

Danny Cox of IFA Hargreaves Lansdown agrees but says the Inges have a lot of good investment funds. Both say the mortgage should be paid off now.


To retire on their current £3,200-a-month joint income, after tax, would mean turning their total financial pot (all investments, cash and pension) of £297,000 into an overall fund of £620,000, says Ms Cardy. Based on their current pension contributions of £600 a month, they would need their assets to grow by 9 per cent (after tax and charges) between now and Chris's 65th birthday - "a little unrealistic", she adds.

Given these figures, the Inges could consider the following options. "They could downgrade their income expectations. If they continue their present savings, then (after 5 per cent growth) they would have a fund of £480,000, which might generate an income of £2,400 a month."

Selling their house is another possibility. Trading down to a less expensive property would generate a lump sum of around £150,000, adds Ms Cardy.

The Inges must also get hold of a forecast of what their state pension will be, says Mr Cox. "As self-employed business people, their state pension entitlement will probably be lower than if they had been employed." The forecast, available using form BR19 online at www.dwp.org.uk, will detail how they could make further contributions.


If there is no specific need to keep the £53,000 in the ING Direct account, the Inges should use that money to pay off their home loan, says Mr Cox. "They are paying 6.45 per cent [on the loan] but receiving 4.5 per cent interest [on their savings] after tax."

Ms Cardy agrees - "even if there are redemption penalties. They should also pay off the remaining personal loan."


Mr Cox is unimpressed with the couple's choice of funds. "It's a bit of a mess. They have a collection of funds, not a portfolio. They need to decide what level of risk they are prepared to take and what they actually want."

The closer they get to retirement, the less risk they should take, he adds. "Equity income funds are a suitable choice, with the prospect of capital growth and a rising income over time." Worth looking at are Artemis, Invesco Perpetual Income and Jupiter.

With their shares and EIS stakes, Ms Cardy says the couple are sitting on "highly volatile investments. If it goes wrong, they will be worse off."

If you would like a financial makeover, write to Sam Dunn at The Independent on Sunday, Independent House, 191 Marsh Wall, London E14 9RS, or email s.dunn@independent.co.uk

Independent Partners; request a free guide on NISAs from Hargreaves Lansdown

Ashley Barnes of Burnley scores their second goal
footballMan City vs Burnley match report
Sir James Dyson: 'Students must be inspired to take up the challenge of engineering'
Life and Style
Apple showed no sign of losing its talent for product launches with the new, slightly larger iPhone 6 making headlines
techSecurity breaches and overhyped start-ups dominated a year in which very little changed (save the size of your phone)
Arts and Entertainment
Catherine (Sarah Lancashire) in Happy Valley ((C) Red Productions/Ben Blackall)
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Selby Jennings: VP/SVP Credit Quant- NY- Investment Bank

    Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...

    Selby Jennings: Quantitative Research | Equity | New York

    Not specified: Selby Jennings: Quantitative Research | Global Equity | New Yor...

    Selby Jennings: SVP Model Validation

    Not specified: Selby Jennings: SVP Model Validation This top tiered investment...

    Selby Jennings: Oil Operations

    Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

    Day In a Page

    A timely reminder of the bloody anniversary we all forgot

    A timely reminder of the bloody anniversary we all forgot

    Who remembers that this week we enter the 150th anniversary year of the end of the American Civil War, asks Robert Fisk
    Homeless Veterans appeal: Former soldiers pay their respects to a friend who also served

    Homeless Veterans appeal

    Former soldiers pay their respects to a friend who also served
    Downfall of Dustin 'Screech' Diamond, the 'Saved By The Bell' star charged with bar stabbing

    Scarred by the bell

    The downfall of the TV star charged with bar stabbing
    Why 2014 was a year of technological let-downs

    Why 2014 was a year of technological let-downs

    Security breaches and overhyped start-ups dominated a year in which very little changed (save the size of your phone)
    Cuba's golf revolution: But will the revolutionary nation take 'bourgeois' game to its heart?

    Will revolutionary Cuba take 'bourgeois' golf to its heart?

    Fidel Castro ridiculed the game – but now investment in leisure resort projects is welcome
    The Locked Room Mysteries: As a new collection of the genre’s best is published, its editor Otto Penzler explains the rules of engagement

    The Locked Room Mysteries

    As a new collection of the genre’s best is published, its editor explains the rules of engagement
    Amy Adams on playing painter Margaret Keane in Tim Burton's Big Eyes

    How I made myself Keane

    Amy Adams hadn’t wanted to take the role of artist Margaret Keane, because she’d had enough of playing victims. But then she had a daughter, and saw the painter in a new light
    Ed Richards: Parting view of Ofcom chief. . . we hate jokes on the disabled

    Parting view of Ofcom chief... we hate jokes on the disabled

    Bad language once got TV viewers irate, inciting calls to broadcasting switchboards. But now there is a worse offender, says retiring head of the media watchdog, Ed Richards
    A look back at fashion in 2014: Wear in review

    Wear in review

    A look back at fashion in 2014
    Ian Herbert: My 10 hopes for sport in 2015. Might just one of them happen?

    Ian Herbert: My 10 hopes for sport in 2015

    Might just one of them happen?
    War with Isis: The West needs more than a White Knight

    The West needs more than a White Knight

    Despite billions spent on weapons, the US has not been able to counter Isis's gruesome tactics, says Patrick Cockburn
    Return to Helmand: Private Davey Graham recalls the day he was shot by the Taliban

    'The day I was shot by the Taliban'

    Private Davey Graham was shot five times during an ambush in 2007 - it was the first, controversial photograph to show the dangers our soldiers faced in Helmand province
    Revealed: the best and worst airlines for delays

    Revealed: the best and worst airlines for delays

    Many flyers are failing to claim compensation to which they are entitled, a new survey has found
    The stories that defined 2014: From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions

    The stories that defined 2014

    From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions
    Stoke-on-Trent becomes first British city to be classified as 'disaster resilient' by the United Nations

    Disaster looming? Now you know where to head...

    Which British city has become the first to be awarded special 'resilience' status by the UN?