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Financial strategy is where our value lies

It’s not a question of do you need to embrace cashflow planning, it’s a matter of when, says Andy Hart, financial planner at Serenity Financial Planning and Voyant Adviser Trainer at

Having a love of financial planning and technology has led me to passionately embrace cashflow planning within my advice business. Seeing this market evolve within our industry has been exciting.

When assessing the impact of new technologies, I often look for examples outside the financial services space. Very similar to the financial advice industry but, I would say, ahead of where we currently sit and so a useful comparison, is the accountancy profession.

In recent years this market has seen an eruption of disruptive client-focused technology. The tools that have been created are elegant, user friendly and assist end users, i.e. business owners, with their accounting and bookkeeping needs. However, these tools have also developed a collaborative approach between the business owners and their ‘professional advisers’, i.e. their accountants. This is a great leap forward; providers have recognised that in order for their software solutions to add value there needs to be a link between the two parties.

So if the advancement in technology for clients and advisers has been slower in financial services than the accountancy world, why is this? I believe the key difference is that accounting software is fundamentally a science, whereas financial planning software is both a science and, importantly, an art. The DIY approach in accounting can be achieved more easily than in the financial planning space.

The disruptive technologies in our market, I believe, are being employed by forward-thinking financial planners.

Fast, responsive tools

Traditional financial planning methodologies have focused on long, detailed, word-heavy reports that were very static. As a result strategies that advisers proposed were simple in their application.

However, people’s lives today are fluid, they are not set in concrete, and our financial planning tools have to be able to reflect that. More importantly, they have to be able to quickly respond to changes in client circumstances.

The advances in comprehensive financial planning tools mean we can finally create elegant lifetime financial plans that not only directly impact what clients do but provide a clear visual picture of their future journey.

Consequently, the reports and planning that maven financial advisers now create are fluid in nature and fluid in their delivery.

Client demands

We also have the imminent emergence of the new mushroom of high net worth clients that will be our main clients in the years to come. These clients will expect a serious level of financial planning skills of their advisers. Products, investment funds, online tools, apps etc will all be commoditised. The only thing that will not be is the advice (relating to a specific recommendation) and crucially the strategy (the fluid ongoing financial plan). The strategy is where our value lies.

So I would argue, it is not a question of ‘do you’ need to embrace cashflow planning, it’s a matter of ‘when’.

I have been using these comprehensive tools for five years now, as have many other planners. Now, I wouldn’t dream of taking on an ongoing client and not working on their cashflow/forecasts. Cashflow planning tools can help identify, for example:

* when a client can stop working and start living the life they wish to live

* shortfalls for accumulation clients that need to save more

* just how much wealthy clients can afford to give away

* when a client has reached the point of achieving their financial goals

* how much a client will need to sell their business for to ensure they never run out of money.

These are just a small handful of the benefits of this type of planning. I’ve heard all the arguments against cashflow planning, this is just resistance from the uninformed. I have also seen planners that were very much against tools but are now vocal evangelists – you know who you are.

Through creating an adviser support network ( I have had the opportunity to work with hundreds of forward-thinking maven financial planners. The work that we do is so advanced from the average IFA selling product (I still meet advisers today that have not heard of financial planning tools – I’m serious!). The success stories that we share through the network are awesome. All the work is conducted via the Voyant Adviser platform.

But, to go back to my opening paragraphs, comprehensive financial planning software is just a tool; it is we, the financial planners who are still the experts. These tools may seem like disruptive technology at the moment but, like all disruptive technology, at some point it will become the absolute standard. Then we won’t be able to remember how we lived without it.

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Disruptive technology

Disruptive technology is a term used to describe a new technology that unexpectedly displaces an established technology. Its opposite is sustaining technology, which develops through incremental improvements to an established technology.

An example of disruptive technology is the telephone, once known as the ‘electrical speech machine’. 

Disruptive technology is often seen as cutting edge but firms who dismiss or ignore it can often find themselves behind the curve as it matures and gains a larger audience and marketshare. 

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