Personal Solutions
Finding your True North
When it comes to knowing where you are and the direction you’re heading in, it’s important to have the right navigational instruments.
We call our financial planning probability program True North because it can assist you to identify your financial goals, and help navigate to achieve them with more control and certainty.
Our aim is to see you reach your own True North.
When used in our fiduciary framework, True North empowers you to set deliberate strategies to reach those goals according to your risk profile. It also enables you to regularly review those strategies and goals with your financial adviser.
Traditional navigation model
The financial planning industry primarily uses traditional straight-line modeling to indicate how you should invest over a period of time until you retire. It assumes a perfect world where there is a consistent rate of annual return on your investment, despite the common-knowledge that this will most likely not happen.
The traditional approach is to then assess your ability to tolerate risk based on those assumptions. Once your risk profile is determined, your financial advice includes recommendations for investment products according to the perfect world scenario modeling.
This may mean the perfect world direction you’re sent on doesn’t account for real life changes.
Our strategic view of risk
We take a strategic view of risk according to our fiduciary commitment to you. It’s not only important to consider the amount of returns you receive, but also when you receive them that plays a vital role in achieving your long-term objectives.
By using True North, your financial adviser can assist you to identify your financial objectives, and help you achieve them with more control and certainty.
The strategic assessment of risk that is embedded within the dynamism of True North is used to calculate the chances of success. It is also incredibly valuable when determining your ideal and acceptable goals. It pinpoints your desired destination exactly and assists in determining the course of action you should be aiming for to reach that destination.
Our navigation model – True North
Our system uses a Monte Carlo analysis method to anticipate the probability of meeting specific financial goals at certain time periods in the future. This is accomplished by generating thousands of possible paths and scenarios that investments might take over the years until the investor is ready to retire or cash out.
The Monte Carlo method is a trusted and successful scenario-modeling method in risk analysis.
The risk analysis of your long-term objectives also considers:
• when you would like to retire or achieve financial independence
• how much you would like to have to spend in your retirement
• how much you can save between now and your retirement
• the financial safety net or estate you would like to leave, and
• a strategic view of your risk.
For more information on we can help you achieve your long-term goals, contact us on (08) 9324 6000, or email planb@planbonline.com.