Hypothetical Case Study #3

Morgan & Santiago: Ages 50 and 54

Making Work Optional

Case Studies

The Challenge:

Morgan and Santiago don’t want to wait until retirement age to start a new chapter. Morgan is a pharmacist at a public hospital and Santiago is a business executive. They have been grinding away at high pressure jobs for over 20 years. They were constantly stressed out, working long hours, and had little time for leisure. They enjoyed high salaries and luxury items, but the pandemic made them rethink their priorities.

They yearned to simplify their lifestyle and were willing to make tradoffs they hadn’t considered before. They wanted to find mission-led work, enjoy their hobbies, and potentially move internationally to Portugal.

When they started their careers, they hadn’t considered changing course off the default path, moving to a different city, or retiring early. But they worry if they keep going full speed they will really burn out. At the same time changing course felt like a tremendous risk and one they were unsure they could take.

Goals:

Figure out how much of a nest egg they would need to create passive income that could support their daily living.
Explore different work options such as downshifting to part-time, taking a sabbatical, or finding more mission-led work.
Decide if moving abroad to Portugal is the right fit for them where they could continue to have high quality of life with lower healthcare, housing, and transportation costs.

The Approach:

It was important to start with helping Morgan and Santiago figure out what was most important.

After many soul-searching conversations, some with their financial planner and some on their own, they decided that the best path was to set their sights on building enough wealth so they didn’t have to continue working at the same level salary.

Together they designed a plan that accomplished the following:

Calculated the worth of Morgan’s pension and their current savings. Understand how their money could grow over time if they invested into a diversified investment portfolio.
Get a clear understanding of their expenses on a monthly basis in the Bay Area and project what expenses could look like in Portugal.
Figure out their their “work optional numbers” so they could start imagining new possibilities for their lives whether they stayed in the Bay Area or moved to Portugal.
Get a clear understanding of their expenses on a monthly basis and project what expenses could look like in Portugal.
Explore financial projections if Morgan were to work part-time as a medical writer and if Sanitago were to do some project based consulting work for non-profits.

The Results:

Change doesn’t happen overnight and they continue at their current employers. But seeing their dreams within grasp has given them motivation to save while looking forward to an adventurous future together.

With the support of their financial planner, they understand how their portolio will change once they leave their jobs, have a withdrawal strategy in place, and someone to lean on for tax planning so that their wealth continues to grow even though they earn less. Most importantly, they feel confident that they can make the numbers work, adjust if needed, and take a leap.

Please note that this case study is purely hypothetical and does not pertain to any existing clients of Modern Family Finance. It is important to understand that no aspect of the content should be interpreted as a guarantee that you, as a client or prospective client, will achieve similar results or levels of satisfaction if you engage Modern Family Finance for financial advisory services.

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