Cashflow modelling (CFM) can be a key step in providing suitable advice in retirement income planning, but it can prove problematic if used incorrectly.
That's been the message from the FCA, which lasered in on CFM as part of its retirement income thematic review back in March. Amid regulatory interest, advice firms have been urged to review their usage of CFM. SimplyBiz's Sandy McGregor and Kris Armstrong this week took a closer look at how advisers should be thinking about how they are using CFM. "As with most financial planning tools, the potential usefulness is dependent upon what inputs and assumptions are used; if used incorrectly, they can create misunderstanding and lead to unsuitable advice," McGregor and Armstrong noted. ...
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