Cashflow Modelling
Using cashflow modelling software, we can build a detailed picture of what your finances might look like in the future according to various scenarios.
Making planning easier
- Will I have enough assets to retire according to plan?
- Will I run out of money later in life if I spend more now?
- Will my loved ones face an Inheritance Tax bill when I die?
- How can my other cash savings contribute to my overall retirement income?
- How can I take a retirement income in the most tax-efficient way possible?
- Would my family be financially secure if I had to go into care or died unexpectedly?
How does cashflow modelling work?
Cashflow modelling uses specialist software to assess your future finances according to your current situation.
The first step is to gather information about your finances as they are today. This includes your monthly income and outgoings, as well as any other assets you might hold, such as pensions, investments and savings accounts.
We’ll then use specialist financial software to analyse this information alongside your income requirements and goals for the future. We can also include future events as part of our calculations, such as one-off expenses, holidays, gifts and retirement, among others.
The result of this process will be a long-term projection of your financial situation. You’ll be able to see how much money you’ll need in the future to meet the goals you’ve identified, and any areas where you might need additional resources in order to strengthen your financial resilience.
We can redo the calculations according to many different scenarios, to see how the path you choose to take in life could affect your financial situation as a whole. You might want to see what would happen if you brought forward your retirement, or if your investments performed better than expected over a number of years. Conversely, you might want to stress test your finances to see if you would be able to weather a downturn in the markets. You can also find out how taking income from different sources could affect your tax liability and overall financial security.
Is cashflow modelling reliable?
While nobody can predict the future, cashflow modelling allows us to make realistic assumptions about your future finances based on real data. As with any forecast, we can’t promise 100% accuracy, but cashflow modelling is excellent for identifying trends and patterns and for showing you if you are on track to reach your goals. It’s always advisable to review your forecast once a year to check you’re still going in the right direction, and to make any necessary adjustments to your financial plan.
