Anyone who has heard me lecture, or read my tax journals, will know how much I strive to achieve perfect results for clients.  This isn’t to say that the journey is smooth and without incident, there are always bumps in the road, but they shouldn’t be feared as we have a plan to deal with them and keep us on track.  The key is to assess, advise, and adapt. 

The perfect game in client planning is ordinarily focussed on the most tax efficient outcome, which is indeed what I have been speaking on for years. Having the largest capital value does not necessarily lead to the best long-term income, nor does saving the highest amount of upfront income tax. 

It can accommodate changes instigated by government policy, your health, and investment returns.  These variables require constant monitoring to allow the tactics to vary throughout the journey.  Constant change is the only certainty in financial planning.  We monitor client investments daily and hold frequent planning meetings to evaluate and finesse our financial advice and investment management.   

A running theme over the past year has been concerns over liquidity and both investment returns.  A lack of liquidity can compound poor investment performance.  We would not want any client to be backed into a corner where they need to sell an investment just to provide liquidity for a withdrawal.  Better to have natural income and maturities of investments to satisfy this need.  Selling investments on demand should be our last tactic considered. 

Allowing investments to mature, pending a withdrawal, does lead to holding cash which, at present, will erode the portfolio value as inflation is greater than interest rates.  In our strive for a perfect game the cost of holding cash outweighs the potential cost of selling investments on demand, which can happen after a market fall.  The current market position is one of positive growth for the future but short-term unpredictable market drops along the way.    

We are launching a series of articles in 2022 to demonstrate how, with balanced planning, your retirement outcome can be perfect.  This can begin with investing the sale proceeds of your business, minimising your income tax bill, or managing future capital gains. 

These articles will delve into the specifics of our planning process by using real client examples.  While these do have a shelf life (as change is constant) we hope they will provide an insight into how we approach our financial planning and investment management for clients. 

Thanks for reading.