What is financial life planning?
You may have heard the phrase Life Planning, or read about it recently in the financial press.
Quite simply Life Planning is a process where advisers aim to provide a more holistic, long term approach to financial planning.
Life Planning is not about the sale of financial products or how well your pension is or isn’t performing this year; it’s about planning for the future with key goals and objectives in mind.
For example, you might have a dream of retiring early and spending your time cruising the canals and waterways of the UK in a narrow boat, but don’t really know if this is affordable.
By working with an adviser who offers a life planning service, he will help you to resolve some of the following questions:
• When can I afford to retire and how much money do I need to help ensure that I never run out?
• Will I be able to live the kind of lifestyle that I want to when I stop working?
• Can I afford to go on that luxury around the world cruise?
• Will it be affordable to start gifting some of my assets to my children?
• I want to be debt free as soon as possible; how do I go about achieving this?
• I hate my job and can’t wait to retire. Is it possible to stop working now?
• When can I afford to change my car?
• I am concerned that my estate will be liable to Inheritance Tax. What can I do to reduce this liability?
Of course this isn’t an exhaustive list of questions, but it does give you an idea how Life Planning could help you to address and deal with the key financial issues which are important to you.
The Life planning process is delivered through a process called Cash Flow Forecasting. Just as a business owner will prepare a financial forecast for the bank manager, your adviser will work with you to build a personal lifetime cash flow forecast.
The cash flow modelling process provides the ability to model ‘what if’ scenarios, which can help you to see what you might be able to achieve and what might require a lottery win!
The most important thing though is that the process provides a clear financial pathway so that you can see exactly what you need to do with your finances and how much you need to save in order to achieve your goals.
Life Planning is available as an optional extra for annual review clients, and as part of the package for Premier Financial Planning clients.
Contact us to find out more about how Life Planning can benefit you…
