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Why Prepare a Personal Cash Flow Analysis?

The basic purpose of a personal cash flow analysis is to determine your monthly needs to support your current lifestyle. This analysis is a method of managing personal cash flow to both meet current obligations as well as seek to provide for your future desired lifestyle.

The creation and use of a personal cash flow analysis serves as a planning tool. Correctly used, a personal cash flow analysis can ensure that income and expenditures match, both in amount and timing.

It can serve to spotlight potential cashflow problems, as well as identify opportunities to make better use of current income for today, as well as preparing for tomorrow in the most tax efficient way.

We believe being on top of your cashflow will help reduce financial stress – now, and in retirement.

The “Projected” Column

The “Projected” Column¹

When filling this out, start with the “Current” column.

You will work together with your advisor on the “projected” column. This optional field refers to “Projected in Retirement.” It is not necessary to try doing on your own.

You can start thinking about it and enter in some estimates if you’d like, but you will be going through this with your advisor.

Please adjust the ones as you see appropriate. Ex: If your mortgage will get paid off, your payment will go to 0. If your kids move out, you might spend less in groceries, but might like to go out to restaurants more. Don’t worry about adjusting for inflation – you will work with your advisor on that. Please put numbers as if you were retired today, what you’d anticipate in today’s dollars.

¹ Projections are inherently limited and should not be relied upon as an indicator of future results.

The cash flow analysis is hypothetical and for illustrative purposes only. It does not constitute individual investment advice and should not be relied upon as tax or legal advice. Individual results may vary. Please consult the appropriate professional regarding your individual circumstance. Past performance is not a guarantee of future results.