We are committed to helping our clients better appreciate the value and benefits of financial planning. One of the ways we do this is by using lifetime financial forecasting, which we also refer to as cash-flow modelling.
This enables us to help our clients understand their financial planning needs better. This is because it allows us to present their financial plan to them in a series of powerful, visual, and interactive charts.
We believe “a picture is worth a thousand words”. Using lifetime financial forecasting will help us to ensure our clients stay informed and fully engaged with those important financial planning decisions as they arise.
What is Cashflow?
Quite simply, it is “money in / money out”. By this we mean what money do we have coming in now and what are we spending now. More importantly, we also mean what do we expect to have coming in compared to what we expect to spend in the future?
The Cashflow chart analyses current and projected future needs goals and aspirations and assesses the likelihood of being able to achieve them, year on year.
Why is it so important?
We believe projecting a financial plan visually helps to engage our clients with their planning. Even more importantly, it helps them answer the three vital questions that matter most to the majority of our clients:
Will we be alright?
- Can we afford our desired lifestyle now and through our lifetimes? What can we do now and what might we need to do in the future to secure this?
Are we still okay if we do certain things?
- Enjoy that special holiday
- Pay for our daughter’s wedding
- Retire a little earlier
- Move house when we retire
- Give some of our wealth away now or in the future
What happens if?
- One of us dies unexpectedly
- One of us is ill and unable to work
- We need long term residential or nursing care sometime in the future
- Our investments perform better or worse than we expect
- We get an unexpected windfall
Cashflow modelling brings all these issues to life visually and helps us to address them.
What do the charts look like?
Timeline
Cashflow
Spending
Assets
Taxes
Would I get a document detailing all this?
All of this can be output as a report incorporating a snapshot of your current financial summary, whether you are on track to meet your financial goals, what the impact might be of retiring early and whatever else is required.
