Careful planning prevents financial catastrophe after career-ending injury

Careful planning prevents financial catastrophe after career ending injury

Why did Paul need our advice?

In his early 30s, Paul was still playing football at a high level when disaster struck, and serious injury brought a premature end to his career.

As the reality dawned on Paul we worked closely with him to rebuild his financial future.

What did we do?

We had provided financial advice to Paul for 10 years before his injury and had always planned that he would take an income from his pension in his mid 30s. However, changes to pension legislation, coupled with his injury, meant that his financial plans needed completely rewriting.

We started by ensuring that he successfully claimed against the insurance policy we had set up many years ago. The claim resulted in a substantial lump sum being paid.

Following his injury Paul had managed to secure a job in football. However, his salary was significantly lower than when he was playing and not sufficient to meet his outgoings. We therefore needed to find ways to top up his income until it was earning enough to meet his needs.

The new rules meant that we decided against recommending money should be taken from his pension now, as it would have limited his ability to make additional tax-efficient pension contributions in the future.

Paul had been sensible over the years and put money aside in a variety of investments. We made an additional investment with the money paid out from his insurance and agreed that an income would be taken to top up what he was receiving from his new job.

Our cashflow forecasting showed Paul that the level of income he was taking probably wouldn’t be sustainable in the long-term, giving him added incentive to climb the coaching or management ladder more quickly.

How did Paul benefit from our advice?

The shock of a career-ending injury, which takes away not only your passion, but also your livelihood can’t be underestimated.

Our recommendation to take out insurance for such an eventuality, and to put money aside during the good years, helped soften the blow. The income he takes from his investments will buy Paul time until the money he is earning from his new role is sufficient to meet his outgoings.

Are you a professional footballer?

Paul was rewarded in his 30s for the sensible financial decisions he took during his 20s.

No one likes to think of a career cut short by injury, but Paul proves it happens. If you are a professional footballer, but haven’t yet taken your financial future as seriously as you perhaps should, we are here to help.

Call Sam on 0115 969 3400. We would be delighted to hear from you.

Please note:

The value of your investment can go down as well as up and you may not get back the full amount invested.

Levels and bases of and reliefs from taxation are subject to change and their value depends on the individual circumstances of the investor.

This case study is for information purposes only and should not be construed as advice. We strongly recommend you seek advice from an independent financial adviser prior to taking any course of action.