A lot has changed in the last few months, from working from home and schooling the children to finding new ways to keep ourselves entertained, the world is a completely different place.
However one change that I find particularly striking, is the quick adaptation of technology.
Those of us who weren’t familiar with or were perhaps reluctant to embrace technology previously, have had no other choice but to embrace it, with names such as Teams and Zoom becoming part of our everyday vocabulary.
As people adapt and try to make sense of our new reality, it is clear that technology is here to stay and will continue to play an increasingly important role in our lives, but more specifically, in the financial planning process.
Whether it be using Zoom or Teams for a client meeting or on-boarding new clients with the likes of Digital Wealth Solutions, it is clear that there is far more appetite out there now, than ever before and Advisers that embrace this new world, will be the ones to thrive and prosper.
Cashflow Modelling
One piece of technology that I feel will play an ever-important role in financial planning, is cashflow modelling.
It empowers clients to make informed decisions, see the Impact of those decisions and allows Advisers to have more meaningful conversations. In essence it brings your advice to life, in a way a suitability report cannot.
We are seeing more and more demand for this from Advisers. Partly, I believe, because clients are demanding more from their interactions with Advisers, whether that be during the initial phase of putting a plan in place, or the annual review and checking that the plan is still on track.
Creating Opportunities
With the global pandemic in full swing and the effect this is currently having on the markets, cashflow planning provides Advisers with a great opportunity.
It gives you a tool with which you can contact your clients and provide real value, by showing the impact the current market conditions are having on their plan.
This can help reassure clients who are feeling a little nervous, as they can see that the plan you put in place and ultimately their goal, is still on track.
If for whatever reason it isn’t, it allows you to look at various scenarios, enabling them to get back on track or even adjust their goals based on reality.
I’m sure we have all seen clients who’s ambitions don’t quite match their financial reality!
A Tool for the Journey
Cashflow planning isn’t a once and done thing, it is ever evolving, taking into consideration the best assumptions for the future and the impact of ever-changing world and everyday life.
One thing that is clear and if the pandemic has taught us anything, is that the future isn’t certain, therefore Cashflows are there to inform decision, not guarantee the future.
Painting a Clear Picture
Financial planning can be complex and confusing to us in the industry, never mind to clients.
Cashflow modelling adds an easy to understand application into the mix and with it, an effective way to bring the plan to life, with clear illustrations. The ability to take something complex and present it in a way that clients can understand, is in my opinion, the true art of financial planning.
Clients who understand, are more likely to be committed to the long-term nature of financial planning and seeing their plan evolve, or on the flip side, be able to cope with different stresses or scenarios a lot more calmly. This will only further increase confidence in you, your business and your financial planning skills.
Additional Benefits
The benefits to your clients is clear, however Advisers also benefit from using cashflow planning when working with professional connection, and as a tool to gain referrals.
They can help with often complex calculations and scenarios and provide a consistent approach to your ongoing client servicing.
In summary, cashflow modelling helps you show the value you and your advice bring to a client.
Find Out More
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