Our exclusive appointment by NS&I to provide a professional financial planning and advice service to the Premium Bonds £1m Jackpot winners has given us a unique insight into the way in which professional financial planning can be so valuable for people who experience ‘sudden wealth.’
 
One winner, a lady who had won a £1m Jackpot prize on her Premium Bonds, was retired with her husband and life was already good. They had recently moved into a new home, which they had funded with an equity release mortgage, were in good health and had a comfortable lifestyle funded by a number of annuities and pensions, underpinned with modest cash savings.
 
Receiving £1m, tax free, out of the blue created mixed emotions, including joy but also a feeling of overwhelm.
 
Our initial approach was to provide a safe pair of hands for them that included three recommendations:
 
Place the £1m in the NS&I Direct Saver Account to ensure it is safe and helps to ensure their anonymity is protected. It also meant that they did not have to worry about the Financial Services Compensation Scheme (FSCS) compensation limit; it was fully guaranteed by the Government. Don’t share the news of their good fortune, at least until they have allowed themselves time for the strong emotional response to lessen, if at all. Take professional advice to ensure they understand all of the options available to them and to place themselves in a much better position to make meaningful decisions about what they do next. By posing the five big questions, it helped them to start to think about opportunities that they had previously dismissed from their minds and to once again consider how they could use their good fortune to improve their own lives and that of their family in a meaningful manner.
 
Over the years, they had taken advice from time to time from a financial adviser and a will writer, but had no understanding of what financial planning was and how it differed from financial advice.
 
The end result was a well-thought out financial plan, which has led on to provide financial advice and implement a number of investments; and to work collaboratively with a suitably qualified lawyer to ensure their wills and lasting powers of attorney are properly established.
 
They are now in a very strong financial position, they have been able to make some gifts to family members (which has given them enormous pleasure) confident in the knowledge that they are not jeopardising their own long-term financial position. Their financial affairs are planned and well-organised so they are able to really enjoy their good fortune.
 
By way of a footnote, it is hugely gratifying from a professional perspective to be able to provide a safe pair of hands for people who find themselves in circumstances such as these; to be able to apply our technical knowledge and to draw upon our experience and to use our skills to achieve great outcomes for clients that would otherwise been missed.