How cashflow planning can help build a bright financial future
A process known as cashflow planning helps us forecast our client's future finances in order to determine whether they're on track to achieve their financial goals.
Life is unpredictable, but visualising your future financial position can help prepare you for anything that life throws at you.
The process will reveal your current position relative to your preferred position by creating a detailed picture of your investments, debts, income and expenditure and projecting this forward, year by year, using calculated rates of growth, income, inflation, wage rises and interest rates.
By analysing your current and forecasted financial position, we can help you plan to ensure that you make the most of your money to achieve your financial objectives.
It can help answer key questions such as:
Will I have enough money to retire when I want to?
Am I going to run out of money in later life?
Can I spend money now on a holiday or help my children purchase a home?
How can I take an income in the most tax-efficient way possible?
Will my family be financially secure if I have to go into care or if I die unexpectedly?
Will there be an Inheritance Tax liability on my death?
The initial step is a detailed analysis of your current situation. How much income do you receive each month? What are your outgoings? How much money do you and your partner have in pensions, ISAs and other investments?
The key data is inputted into a specialist computer programme which will crunch the numbers to create a long term projection of your finances. This will show your future requirements alongside any increase or decrease in your assets, helping to identify any potential surplus or shortfall.
Considering different scenarios
Cashflow planning is particularly useful in the analysis of different 'what if' scenarios.
For instance, retiring earlier, a lower than expected return on your investments, downsizing your property or rising inflation. Considering different scenarios can help you plan for life's unexpected events.
How accurate is cashflow planning?
Cashflow planning can help us make sensible assumptions about your future finances. Like any forecast, it's never going to be completely accurate, but it can identify trends and show you if you are on track to reach your goals.
Cashflow planning is not a one off exercise, it’s something that should be revisited from time to time to ensure it reflects your changing situation.
No obligation consultation
Whatever life stage you are at, now is the time to ensure you have the right plans in place to secure your financial future. Clearly your priorities change with age and the commitments and responsibilities that you have. We understand how to help you build a plan that is right for you now and in the future. Contact us today for a FREE initial no obligation consultation.
IMPORTANT: Investment involves risk. The value of investments and the income from them can go down as well as up and you may not get back the amount originally invested. Past performance is not a reliable indicator of future performance.
Bright Future Financial Limited Registered Address: Little Orchard, Doatshayne Lane, Musbury, Devon EX13 8BD. Registered in England & Wales, No. 10909347
Bright Future Financial Ltd is an Appointed Representative of Vision Independent Financial Planning Ltd which is authorised and regulated by the Financial Conduct Authority (FCA).
Vision Independent Financial Planning Ltd is registered in England and Wales registration number: 6650476. Registered Office: Vision House, Unit 6A Falmouth Business Park, Bickland Water Road, Falmouth, Cornwall, TR11 4SZ. To verify our status please visit the FCA Register. Our FCA number is 487395.
The guidance or information contained within the website is subject to the UK regulatory regime and is therefore aimed at consumers in the UK.