Our approach to financial planning

The traditional role of an IFA is to recommend investments and other financial products to fulfil a client’s perceived needs. Whilst in most cases BWM LLP will make such recommendations to our clients, this is done not in isolation but in the context of a holistic financial plan.

A financial plan is personalised strategy that provides detailed guidance regarding how an individual or family should organise their finances in order to achieve their financial and lifestyle goals. The key difference therefore is that emphasis is not on single transactions or pieces of advice to fulfil an immediate need but how these fit within an ongoing, integrated strategy that considers all aspects of the client’s personal and financial circumstances.

A financial plan takes into account personal and financial circumstances and then, making certain mutually agreed assumptions, provides a projected view of where finances will be at a certain point in the future. The information in the plan can then be reconciled with a client’s aspirations in order to define and quantify those aspirations into a set of realistic goals and agree upon a strategy to achieve them.

A financial plan is a personalised view and a dynamic one – no two financial plans will be the same and a plan will change from year to year in reaction to changes in the economy and in a client’s circumstances and objectives. All financial plans have the same objective though – to provide a client with clarity regarding their financial goals and how they can best be achieved. In order to do this a typical financial plan will include:

• Financial and lifestyle goal setting.
• Net Worth Analysis – lifetime assets and liabilities.
• Cash Flow Planning – an analysis of lifetime income and expenditure, including specific costs such as educational fees.
• Investment Planning – how much will you need to invest to achieve your goals and what returns will you require?
• Personal Risk Planning – what level of risk must be taken to meet goals – is it acceptable?
• Personal Protection Planning – the impact of possible disasters, illness and death.
• Tax Planning and Mitigation – the impact of tax on your income and net worth.
• Retirement Planning – when will you become financially independent, what level of income will you require to do so? Is this achievable and reconcilable with your other goals?
• Estate Planning – planning to leave a legacy – is this realistic given your other requirements, how can you minimize IHT?
• BWM uses a detailed questionnaire and a sophisticated software system to produce our financial plans and for most clients these form the basis of our proposition in that our recommendations to you will stem from the strategy outlined in the plan.