Pension Cashflow Retirement Planner - Key Info?

coyrls

GSP said:

coyrls said:

Has he explained what his recommended withdrawal strategy is?

No. He just said I was taking ‘a little too much’ out of the fund according to his quick and dirty spreadsheet and would run out of money.

I would think that "how much should I be taking and why?"  would be reasonable questions.  Are you withdrawing money independently or going through him?

GSP

BritishInvestor said:

GSP said:

Before this thread goes off on a tangent about historical occurrences, can we please keep on topic, or start another thread. Thanks
Going back, my FA has sent me in his words a ‘quick and dirty’ planner which includes just a few metrics which he using to base my future activity on. Thinking more, I assume this is based on being cautious, and he has every right to advise that.
If I came up with my own planner, results and recommendations, would he welcome I have taken the time to look through numbers in more detail, or think I am trying to undermine him. It cannot look good if I provided something more fit for purpose perhaps.
Again, he described this planner as a start. I could tell him I am filling in more detail, as long as he agrees to that.
What I don’t want to do is upset the relationship though. I am happy with the way he has reviewed my holdings.
The bit I am uncomfortable about is basing decisions just on one set of data and given the lack of it in there, it must be flakey to say the least. I prefer two sets of data or results to tell a story. If one contradicts the other one, you know you have a problem or at least something that needs looking into. That’s the ‘beauty‘ of data, sometimes!

"What I don’t want to do is upset the relationship though. I am happy with the way he has reviewed my holdings."
I'm not sure how he can review holdings in the absence of a comprehensive retirement plan. How would you choose a retirement portfolio that aligns with the risk you need to take (and are happy taking) without undertaking a planning exercise first? 
It would cut a large chunk of time from the retirement planning exercise so I'm all ears

He has recently done a risk exercise which came out as 5/10.

GSP

coyrls said:

GSP said:

coyrls said:

Has he explained what his recommended withdrawal strategy is?

No. He just said I was taking ‘a little too much’ out of the fund according to his quick and dirty spreadsheet and would run out of money.

I would think that "how much should I be taking and why?"  would be reasonable questions.  Are you withdrawing money independently or going through him?

No, it all goes through him.
Going back to my OP, what would you consider to be the key metrics to create a planner? One observation when constructing, surely certain numbers need to be calculated separately. My FA came up with a real return figure of 1% which appeared to be growth of 3% less 2% inflation and applied every year for forty years. £36,000 outgoings remained constant as well. Surely the inflation relates to the outgoings, and the growth for the fund should be left alone with outgoings plus inflation deducted?

dunstonh

If I came up with my own planner, results and recommendations, would he welcome I have taken the time to look through numbers in more detail, or think I am trying to undermine him. It cannot look good if I provided something more fit for purpose perhaps.

The IFA will be pleased you are engaging in something serious and would not for one minute think you are undermining them.   

BritishInvestor

GSP said:

BritishInvestor said:

GSP said:

Before this thread goes off on a tangent about historical occurrences, can we please keep on topic, or start another thread. Thanks
Going back, my FA has sent me in his words a ‘quick and dirty’ planner which includes just a few metrics which he using to base my future activity on. Thinking more, I assume this is based on being cautious, and he has every right to advise that.
If I came up with my own planner, results and recommendations, would he welcome I have taken the time to look through numbers in more detail, or think I am trying to undermine him. It cannot look good if I provided something more fit for purpose perhaps.
Again, he described this planner as a start. I could tell him I am filling in more detail, as long as he agrees to that.
What I don’t want to do is upset the relationship though. I am happy with the way he has reviewed my holdings.
The bit I am uncomfortable about is basing decisions just on one set of data and given the lack of it in there, it must be flakey to say the least. I prefer two sets of data or results to tell a story. If one contradicts the other one, you know you have a problem or at least something that needs looking into. That’s the ‘beauty‘ of data, sometimes!

"What I don’t want to do is upset the relationship though. I am happy with the way he has reviewed my holdings."
I'm not sure how he can review holdings in the absence of a comprehensive retirement plan. How would you choose a retirement portfolio that aligns with the risk you need to take (and are happy taking) without undertaking a planning exercise first? 
It would cut a large chunk of time from the retirement planning exercise so I'm all ears

He has recently done a risk exercise which came out as 5/10.

The biggest risk facing many people in retirement is running out of money. An output from a risk questionnaire doesn't really address that issue.

GSP

BritishInvestor said:

GSP said:

BritishInvestor said:

GSP said:

Before this thread goes off on a tangent about historical occurrences, can we please keep on topic, or start another thread. Thanks
Going back, my FA has sent me in his words a ‘quick and dirty’ planner which includes just a few metrics which he using to base my future activity on. Thinking more, I assume this is based on being cautious, and he has every right to advise that.
If I came up with my own planner, results and recommendations, would he welcome I have taken the time to look through numbers in more detail, or think I am trying to undermine him. It cannot look good if I provided something more fit for purpose perhaps.
Again, he described this planner as a start. I could tell him I am filling in more detail, as long as he agrees to that.
What I don’t want to do is upset the relationship though. I am happy with the way he has reviewed my holdings.
The bit I am uncomfortable about is basing decisions just on one set of data and given the lack of it in there, it must be flakey to say the least. I prefer two sets of data or results to tell a story. If one contradicts the other one, you know you have a problem or at least something that needs looking into. That’s the ‘beauty‘ of data, sometimes!

"What I don’t want to do is upset the relationship though. I am happy with the way he has reviewed my holdings."
I'm not sure how he can review holdings in the absence of a comprehensive retirement plan. How would you choose a retirement portfolio that aligns with the risk you need to take (and are happy taking) without undertaking a planning exercise first? 
It would cut a large chunk of time from the retirement planning exercise so I'm all ears

He has recently done a risk exercise which came out as 5/10.

The biggest risk facing many people in retirement is running out of money. An output from a risk questionnaire doesn't really address that issue.

After completing a risk assessment questionnaire at the start and more recently, and his ‘quick and dirty’ cashflow planner 10 days ago, that’s about it. 

coyrls

GSP said:

coyrls said:

GSP said:

coyrls said:

Has he explained what his recommended withdrawal strategy is?

No. He just said I was taking ‘a little too much’ out of the fund according to his quick and dirty spreadsheet and would run out of money.

I would think that "how much should I be taking and why?"  would be reasonable questions.  Are you withdrawing money independently or going through him?

No, it all goes through him.
Going back to my OP, what would you consider to be the key metrics to create a planner? One observation when constructing, surely certain numbers need to be calculated separately. My FA came up with a real return figure of 1% which appeared to be growth of 3% less 2% inflation and applied every year for forty years. £36,000 outgoings remained constant as well. Surely the inflation relates to the outgoings, and the growth for the fund should be left alone with outgoings plus inflation deducted?

If he is only using "real" returns (i.e inflation deducted), there is no need to add inflation to your outgoings.  The alternative would be to use nominal returns (i.e no deduction for inflation) and then add inflation to your outgoings.  Either way the result would be the same, just expressed differently.  His method is probably better because everything is expressed in "today's prices" and is therefore easier to understand.

GSP

coyrls said:

GSP said:

coyrls said:

GSP said:

coyrls said:

Has he explained what his recommended withdrawal strategy is?

No. He just said I was taking ‘a little too much’ out of the fund according to his quick and dirty spreadsheet and would run out of money.

I would think that "how much should I be taking and why?"  would be reasonable questions.  Are you withdrawing money independently or going through him?

No, it all goes through him.
Going back to my OP, what would you consider to be the key metrics to create a planner? One observation when constructing, surely certain numbers need to be calculated separately. My FA came up with a real return figure of 1% which appeared to be growth of 3% less 2% inflation and applied every year for forty years. £36,000 outgoings remained constant as well. Surely the inflation relates to the outgoings, and the growth for the fund should be left alone with outgoings plus inflation deducted?

If he is only using "real" returns (i.e inflation deducted), there is no need to add inflation to your outgoings.  The alternative would be to use nominal returns (i.e no deduction for inflation) and then add inflation to your outgoings.  Either way the result would be the same, just expressed differently.  His method is probably better because everything is expressed in "today's prices" and is therefore easier to understand.

I would say there would be a different outcome from this. Adding inflation % to the much bigger number of the pot would have a greater effect than including with the smaller outgoings figure.

Time4T_Accounts

You need to think in terms of the purchasing power of your money.  As long as the ‘mix’ of your income and the ‘mix’ (basket) of your expenditure is broadly constant, then the monetary value of the difference between them will have the same purchasing power.  The number of pounds difference might widen, but that number of pounds won’t buy any more or less than it did previously.

coyrls

GSP said:

coyrls said:

GSP said:

coyrls said:

GSP said:

coyrls said:

Has he explained what his recommended withdrawal strategy is?

No. He just said I was taking ‘a little too much’ out of the fund according to his quick and dirty spreadsheet and would run out of money.

I would think that "how much should I be taking and why?"  would be reasonable questions.  Are you withdrawing money independently or going through him?

No, it all goes through him.
Going back to my OP, what would you consider to be the key metrics to create a planner? One observation when constructing, surely certain numbers need to be calculated separately. My FA came up with a real return figure of 1% which appeared to be growth of 3% less 2% inflation and applied every year for forty years. £36,000 outgoings remained constant as well. Surely the inflation relates to the outgoings, and the growth for the fund should be left alone with outgoings plus inflation deducted?

If he is only using "real" returns (i.e inflation deducted), there is no need to add inflation to your outgoings.  The alternative would be to use nominal returns (i.e no deduction for inflation) and then add inflation to your outgoings.  Either way the result would be the same, just expressed differently.  His method is probably better because everything is expressed in "today's prices" and is therefore easier to understand.

I would say there would be a different outcome from this. Adding inflation % to the much bigger number of the pot would have a greater effect than including with the smaller outgoings figure.

Do some experiments with a spreadsheet and you will see that you are wrong.