Choices

“…How much is enough to retire when you are in your late 40s?”

Andy and Sarah met in San Jose at a technology company in the late 90s. When the technology bubble burst, they took the opportunity to move back east to New England where they both grew up. They founded a small technology start-up providing billing software to law firms, which enabled them to live a comfortable suburban life while enjoying time with their family. A few technology firms approached them with offers to purchase the business. With their youngest child looking at colleges, Andy and Sarah were starting to think about next steps. But how much is enough to retire when you are in your late 40s?

After attending a small-business seminar they decided to move beyond asking questions. Unsure of the value of their business and how much they would need to secure their financial future, we began working together on putting some numbers into their plan.

Andy and Sarah had experienced the effects of market turbulence, first-hand, when the tech bubble hit. They also felt its effect in 2008 when law firms started to consolidate, impacting their revenue. What if another correction happened before they sold their business? The business was providing sufficient cash flow to meet their day-to-day needs, college expenses and retirement savings, but what if that cash flow was no longer available? Were there ways they could improve upon their savings plan to provide greater certainty now and in the future?

Working closely with Andy and Sarah, we helped them go back to the basics, reviewing their income streams and itemizing their expenses. They discovered several areas where they could increase savings for their retirement, and we developed an investment program in line with their risk tolerance. They discussed their long-term goals including travel, gifting to children and the purchase of a new residence on a lake in New Hampshire. We built out and reviewed simulations of their cash flow at various allocation mixes and retirement returns. This allowed them to identify the level of assets needed to achieve their goals, providing them comfort that their goals were within reach.

Andy and Sarah are currently considering two potential offers for their company. Due to the analysis and projections we provided, they have a more secure outlook on their future and confidence to make an informed decision on the sale of their business when the time and terms are right.