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Why cashflow planning software is so beneficial

There are wealth of benefits associated with cashflow planning software, both for financial advisors and their clients.

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This type of financial advisor software is hugely advantageous and yet is still not as popular as risk profiling tools. Platforum research revealed that 98 per cent of advice firms have risk profiling tools, but just 85 per cent make use of cashflow planning software.

Role to play

The FCA, which can be found at, consulted on whether cashflow planning played a role in defined benefit transfer analysis and had previously recommended it for clients and consumers in decumilation.

The Platforum research found that 39 per cent of advisors use cashflow planning for 75 per cent or more of retirement clients, while 43 per cent use cashflow planning on 25 per cent or less of clients. Some might also use software from the likes of

Most people need to understand the relationship between their income and spending, and cashflow planning is vital. In order to achieve this, financial advisors can use software to help them fully appreciate their clients’ expenditure and income.

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Speed and simplicity

Studying cashflow can seem like a drawn-out process. This is where relevant software can come into its own, simplifying what can seem like a laborious task. This is helped further by the use of itemised credit card and bank accounts, meaning that cashflow planning has never been faster or easier to accomplish.

Cashflow planning, helped by good software, can be essential to financial advisors enriching the advice they can offer to clients and justifying the annual fees they charge. It can also help to alleviate client fears that they will run out of money before they die.

Cashflow planning should be central to any client review, enabling basic parameters to be set that will see clients through to the end of their lives.

It is worth noting, however, that forecasting will never be foolproof. People will underspend or overspend, life-changing events will happen and investments will fluctuate, all leading to changes in projected figures.

Nevertheless, it can offer a useful guide and should be based on accurate data, along with clients’ predictions of how their expenditure will perform going forward and advisor knowledge of typical trends and patterns. This will form a more comprehensive package of financial planning.

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