Cash Flow Plans

Many people will have the ambition to become financially independent at some stage in their life. For some this might mean stopping work, others may choose to continue working but know that it is on their terms. In both cases it is about being able to support yourself financially using the wealth you have accrued to that point.

Understanding what is required to reach financial independence and knowing when you have arrived is complex. It requires in-depth knowledge of your income from all sources, your tax position, expenditure and your desired lifestyle going forward. To compile this information we use a powerful cash flow planning tool.

Crucially this cash flow planning tool does not provide you with merely a spreadsheet full of numbers, but instead distils this information into a series of clear graphs and charts which provide important insights into your financial future.

It is important to recognise that cash flow planning is about modelling different scenarios based upon the information we have today and making assumptions about the future. The plans are not intended to be forecasts of your future, as there are far too many potential variables, each of which may have a big impact on the models. Instead they are intended to help provide insight into how your finances might change over time based upon the inputs and choices made today.

Once constructed, these models are stress tested and manipulated to reflect varying scenarios, ensuring they are robust and fit for purpose. This also highlights any areas where additional planning may be necessary.

For most people, in our experience, pensions, savings and investments are simply the means by which you intend to achieve your desired financial objectives. However, understanding how to use those various pots of money to achieve the best outcomes is generally what creates the greatest concern for people. Cash flow planning provides you with a clear visual representation of how these two elements come together, using your capital streams in the optimum way year on year, to finance your lifestyle goals.

We believe cash flow planning is a fundamental part of financial planning and we include this as part of our standard ongoing service for clients. As all models are based upon assumptions, keeping these regularly updated as part of your Annual Review ensures they remain accurate and therefore relevant to your circumstances.