Cash Flow Planning vs. Goals Based Planning
There are two general ways to approach financial planning; cash flow planning and goals based planning.
Cash flow planning – this process takes into account your current assets, how they will grow, and gives you a predicted amount of future cash flow. You then model your future lifestyle based on how much money you will likely have.
Goals based planning – this process focuses on outlining a clear picture of what your financial goals are. These goals are ranked by priority and given an estimated cost. Your assets are then used to fund these goals in order of importance.
We primarily use a goals based approach. We want the focus to be on what you ultimately want to have. This allows us to set clear action items to help you achieve your stated goals. The cash flow planning is worked into our process, as we evaluate the money needed to fund your goals, but the focus is always going to be on what you want to achieve.