You don’t have to be a qualified financial adviser to understand that running out of money is not typically a positive thing to experience. Yet, in the age of low interest rates and easy access to various different types of finance, such as credit cards and short term loans, many people have adopted a laissez-faire attitude to managing their finances. With the advent of phrases such as “live in the moment” and “life is short”, financial planning has fallen to the bottom of many peoples’ priority list.
In previous generations more popular mottos were “make do and mend” and “live within your means”. However, this way of thinking can also lead to people working hard for their whole lives to build up significant savings, only to realise that they actually don’t have a plan on how they want to spend them. To quote another famous saying – “Nobody wants to be the richest person in the cemetery.”
Ultimately, life is not a rehearsal and we each need to feel as though we have the financial freedom to do what we want to do, something John has covered in his previous blog “What’s your number”.
With recent pension rule changes allowing people to take as much or as little from their pension pots as they wish each year, striking a balance between frugality and frivolity has never been so complex and as such it is important to seek help where needed.
Our approach to advising our clients lies somewhere between these two extremes. We believe that it is absolutely vital that all of our clients feel they are getting the most out of their money and living their dream lifestyle for as long as possible. Yet, inevitably for most people, living the dream comes at a cost and pushing forward without first taking the time to plan your next steps is often what leads people to financial hardship.
Lifetime cashflow modelling allows us to show our clients, in an easy to understand format, how much they will be able to spend throughout their lives without ever having to worry about running out of money. In the event that the initial plan indicates any income shortfall, we can then work on suitable strategies to plug this gap. Therein lies the real benefit of utilising modern cashflow planning software; being able to simulate different strategies or scenarios, allowing you to be financially prepared for anything that may be thrown your way in the future.
We feel that all of our clients should experience the benefit of lifetime cashflow modelling and the peace of mind that it can offer. Should you wish to see this firsthand, please contact us and we will be more than happy to demonstrate the benefits of the modern way of financial planning.