Cashflow Modelling: Seeing Your Financial Future Before You Commit to It
Most financial decisions are made on instinct and a spreadsheet. Cashflow modelling replaces both with something you can actually interrogate.
What it is
A model of your finances projected forward across your lifetime: income, expenditure, assets, debts, tax and inflation. It shows the trajectory, and more usefully, what happens when you change something.
The questions it answers
Can I afford to retire at sixty rather than sixty-five?
What happens if markets fall sharply in my first year of drawing income?
Can I help my children with a deposit without damaging my own plan?
How much can I give away in my lifetime and still be comfortable?
What if one of us needs care in later life?
What if I live to ninety-five?
What it is not
It is not a prediction. Every model rests on assumptions about returns, inflation and longevity, and those assumptions will be wrong to some degree. Its value is not precision — it is showing which decisions the outcome is genuinely sensitive to, and which barely matter.
Why people find it useful
Because it converts anxiety into arithmetic. Most people arrive worried about the wrong thing, and leave knowing which lever actually moves their outcome.
If you'd like these questions answered for your own situation, download our free guide, The Pre-Retirement Pension Review, or book a free no-obligation call at www.dmfinancialplanning.co.uk.
Important information
This article is for general information only and does not constitute personal financial advice. The value of investments can fall as well as rise and you may get back less than you invest. Tax treatment depends on individual circumstances and may change. A pension is a long-term investment; funds cannot normally be accessed until age 55 (57 from 2028). DM Financial Planning is a trading style of Aegis Financial Planning Limited, authorised and regulated by the Financial Conduct Authority (FCA No. 624298).
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