The One Mistake That Collapses Your Retirement Cashflow and 8 Steps To Solve the Problem

Added: 2026-05-10

[00:00:00]Well, in this video, I'm going to cover off the number one mistake that quietly and slowly destroys retirement income plans. I know that sounds a little bit dramatic, but we've had the privilege of working with hundreds of families across Canada develop and construct their retirement income plans, help them launch into retirement and to have a great retirement. But along that journey, we've seen what works really well, and we've seen things that haven't worked so well. We've identified some specific issues that gets people into trouble. And it's not going to be bad financial markets or bad economies. That almost never destroys or hurts a retirement income plan. It's something much simpler than that. What hurts planning is a poorly constructed cash flow and budgeting plan. Yeah, you heard me. A poorly constructed cash flow and budgeting plan. So, we're going to walk you through the lessons we've learned.

[00:00:50]There's eight strategies you absolutely need to keep in mind, not just as you're planning for retirement, but throughout your retirement journey. We're also going to share with you how we work with clients to get clear on the cash flow and budgeting area and connected to each aspect of their planning. Conceiving first of all their budget, what their goals are, and then looking at the modeling with the software applications that we use, and then looking at the specific investment strategy to make sure their cash flow plan is funded.

[00:01:18]We're going to show you each step. I'm going to show you samples from the work that we do with clients. This is going to be very practical. We're going to lift the hood and show you exactly how we do it for clients that hire us to do a retirement income plan. Okay, let's just discuss what we're going to be covering in this uh video. So, section one, we're going to talk about goals.

[00:01:36]And this is the critical first step. I know you've heard it all before, but I'm going to show you a fillable PDF, a great worksheet that is part of our complimentary retirement resource library. I'm just going to show you the worksheet how you can use it to get clear on your goals because ultimately your goals then drop into cash flow planning. And cash flow planning is defined by what you want to do in your retirement. Again, I'm going to show you some spreadsheets and some applications we have free of charge that you can use to get really clear on your cash flow planning. Your goals are aspirational.

[00:02:10]Your cash flow planning and budget is what puts everything into action. And I'm going to give you some tips on how to use the resources. Once you're clear in your cash flow planning, then we get into step three, and that's projection modeling. Taking a look at our software application and taking your cash flow budgeting that comes from your planning and putting that into the actual model to make sure that you've got the most efficient cash flow generation system possible. Once that's done, we get into step four or stage four, which is portfolio strategy. I'm going to show you the actual template that we provide clients around linking their retirement income plan and their draw down strategy to their portfolio strategy so they know exactly how to structure their investment portfolio to do what it needs to do to fund retirement income over the long term. Throughout the video, we're going to cover off the eight strategies that keep you out of the danger zone.

[00:03:05]Well, hi. If we haven't met before, my name is Sean Humphre with Humphre Wealth Group. We've been helping Canadian families for three decades plan for retirement. And if you'd like to know more about our retirement readiness system, make sure you go back to the show notes. There's a link to our website where you can find out how you can get a complimentary second opinion about your retirement income planning as well as tapping into complimentary resources. Now, what I'd like to do now is just talk about the real problem. And there's a there's an aspect of this planning that is emotional and psychological. And it's one of the reasons why people have trouble really planning in this area. So you can see the first issue is budgeting is based on income. For most people going into retirement, they get their income on a regular basis bi-weekly or once a month or twice a month and then they're forced to budge around that systematic payment that comes to them. When you retire, you're now in a situation where you're able to engineer retirement income, right? You can customize when income comes to you for various reasons, whether it's spending more in the go- go years or maybe taking assets out of various accounts for tax efficiency reasons. Now, it's an engineering problem and you need to lean into this engineering problem to make sure your assets are well managed and you're getting the most from them. In a pre-retirement world, we're in static planning mode. Again, it's just systematic income coming in and we plan around that income. When it comes to retirement, it's dynamic and adaptive because for many retirees, yes, they might have some pension income, but a lot of their income is going to be funded through their investment accounts, whether it's their TFSA, their RIFs, their RRSPs, their LIFS, their non-registered portfolio, maybe they have some corporate assets, and it's going to respond to that very customized dynamic plan. Again, if I go back to the go-go phase, maybe you're traveling more, maybe there's gifting you want to do with your family. So it becomes a very much an engineering problem and it's dynamic and it needs to be adaptive. We then have set it and forget it. It's one of the nice things about cash flow coming in when we're working.

[00:05:04]We get it. It comes in, we set our budget and it's systematic, at least for for many of us. When you get to retirement, you just you have to engineer it. But once it's engineered, once you've done the really hard lifting, then you can make it systematic. Okay? Okay. So when you take a look at the real problem here, the cash flow generation system that we have before we retire is much different than the cash flow generation system we have when we move into retirement. And this is a bit of a head fake for people. And this is one of the reasons that we sometimes see people having problems and their plan over time losing traction and not doing for them exactly what they want to have happen. Okay. Step one, what do you need to do? You need to define your cash flow. And that's looking at your non-discretionary expenses. Those are the essentials.

[00:05:50]Looking at your discretionary expenses, that's your hobbies, travel, dining out, your periodic expenses. It could be for property taxes, car repairs, getting a new car, your lifestyle go-go phase, and of course looking at maybe gifting, supporting children, grandchildren, and charities. So that's where we get into the first step in the planning process.

[00:06:12]So, more often than not, when I meet with a family, the first thing I'm going to talk about is, have you looked at your expenses? Have you done some visioning, some dreaming about what retirement is going to look at? Now, one of the best parts of retirement income planning is dreaming a little bit about what retirement is going to look like.

[00:06:27]And that's your aspirational goals, your lifestyle, how you want to map out your retirement. So, the goals piece is really important, like I said, because that defines your budget, right? So, if you go to our website and then you go to planning resources and then the free retirement planning resource bundle, that's going to take you to this page and you can sign up for these resources and I'm going to reference some of these resources in this presentation. There's some of the same resources we use when we are retained by a family to help them develop their retirement income plan.

[00:06:56]So, the first resource we're going to take a look at is a resource that talks about their goals. We call it how to design your best later life or how to design your retirement life. So, let's take a look at that resource. Okay, now you've registered for the resource bundle. Here's the uh homepage for it.

[00:07:12]And the different resources are listed here. I'm going to go down to this particular resource, retirement goals beyond money. Let's just click that.

[00:07:20]Now, I've got an introductory video here, but I'll just go through the section. You can take a look at there's the workbook, and when you click on that, it's going to give us a PDF. So you can download this to your device and it's a fillable PDF so you can work your way through a lot of great questions and these questions get into really thinking through the the go-go phase of your retirement journey. Uh thinking through what you're going to do with your time and so it's a very practical document.

[00:07:48]It also are you going to work part-time doing some contract work? Uh how you going to organize your day? What are the key activities you want to be involved in? So, it's planning out what your retirement life is going to look like.

[00:08:00]Like I said, that's going to cost money and that's going to flow naturally into your budget planning. So, I'd encourage you to go through this document because it's very helpful to get inside some thinking around how you're going to structure your time, what you're going to do, how your time compares to how you handle time now, and how you're going to handle it in retirement. U there's a lot of aha moments that you'll go through when you complete this document. Okay, step two. Now, step two is about tracking your spending. And I know you don't want to do this, but it's a really important part of the planning process.

[00:08:33]So, when I sit down with a family or an individual, I always say to them, okay, let's go through the goal section. Now, we're going to look at your budget planning. You've got your ideal budget, but we need to take a look at some historical budgeting. How are you spending your money right now? So, what I encourage people to do is to take a look at the, you know, the last, you know, 6 to 12 months. Use that as a starting point in their budget.

[00:08:54]uh ideally track every dollar. It's very eye opening. So remember, you're going from a static budget situation with regular paychecks coming in typically to now you can control it. And it's really important you get clear on this number because you don't want to be generating more income than you need when you retire because that'll create some inefficiencies which I'll talk about later on. You want to generate sufficient income and good starting place there is just track every dollar for a 6 to 12 month period. I'd really encourage you to do that. And I'm going to show you some worksheets that you can use for that exercise. Number two, you want to get very clear on se, you know, variable and fixed costs that can come up over the years. This is the one that can really surprise people. Sometimes it's caused because tax remittances aren't properly calculated and they have some surprise tax bills at tax time. Uh maybe there's a new vehicle that has to be purchased. You know, maybe the grandkids need some financial help. So that fixed versus variable um is very important. And then you want to identify leakage. One of the benefits of going through at least for a short period of time a tracking of your expenses is you will come up with some aha moments.

[00:10:01]That's the most common thing that I hear is that geez I didn't realize I was spending that much on such and such. So these are the three areas. Track your spending over 6 to 12 month period.

[00:10:11]Identify fixed and variable as well as your non-discretionary and discretionary. Identify where the leakage might be. So that tells you you might have some flexibility in your budgeting. So, here's the first reality check in this presentation. Stats tell us that most people underestimate their irregular expenses by as much as 40%.

[00:10:29]Between 20 and 40%. So, remember we talked about subtle problems eventually become not so subtle or big problems.

[00:10:37]This is one of those things where if you're not dialed into your cash flow planning now before you retire, it can really come back to bite you. You need to identify these irregular expenses.

[00:10:48]you know, what was your budget? What was your actual spend? What was that delta?

[00:10:54]Like, why didn't you hit your budget?

[00:10:56]You're not going to have quite as much maneuvering room when you retire. So, you need to dial into this particular area. Again, I'm maybe fggging a dead horse a little bit here, but you want to make sure that you're looking at your expenses, tracking them, and then that helps you to develop your budget for your retirement. Okay, let's take a look at another resource from the retirement resource bundle that will help you in this exercise. Okay. So, this is the introduction to the um retirement cash flow planning. There's a little bit of an introductory video. Uh and if you want um under the show less here, then show more, you'll see a link here to a little video course that uh that we created that may be more than what you'd need. Although, given how important this topic is, I'd encourage you to take a look at it. There might be some ideas that would be useful for you. And then below the link for the video course, you're going to see some resources here.

[00:11:44]So what we'll do is take a look at the expense worksheet resource. So this expense worksheet is pretty straightforward and you know these worksheets more than anything else are just very helpful to kind of prompt you.

[00:11:56]You know sometimes we forget about various expense categories. So I would encourage you to sit down or you can do it on your computer as well. This is a fillable PDF document and it just goes through all the main expense categories whether it's housing or food. Uh you got health care, insurance, um all the main categories are listed here and you can do it monthly, you can annualize it and then you have maybe some periodic expenses that are not monthly that you can put in the annual category. And then beside each of the expense categories will be your retirement budget. So again, take a look at where you're spending money today and then begin developing your budget. Now, this is a really important step in the process because we're going to use these numbers. So when I work with families, we go through a bit of a budgeting discussion and exercise and then we take this information and we plot it on our retirement income modeling software.

[00:12:48]Right? So there's a there's a very practical linkage between this exercise and the software. So again, step one was getting clear on the goals. Step two is to go through looking at current cash flows, where we're spending our money, and then visioning out what the retirement budget's going to look like.

[00:13:04]And then we take that particular data and put it on our financial modeling.

[00:13:07]software. So now we're at the snap projection software and this is the master spreadsheet and really the main thing I wanted to show you here is we've got Sam and Sally and they went through their goals discussion, they went through their budgeting and these are the numbers that we arrived at and you should go through the same exercise and again when we work with clients we take them through exactly these steps. So the first thing is we have our basic sort of non-discretionary expenses. This is their their overall budget and they they're budgeting that they need about $90,000 per year in after tax dollars and there's a little bit of wiggle room in that and we're indexing that expense by 3% per year. So in today's dollars it's 90,000 but we want to absolutely model what the inflationary pressures are going to be. So that 90,000 by the time they get into their early 80s is up to $120,000 of after tax expenses.

[00:13:57]Another budgeted item for them is travel. So, they've got travel expenses of $15,000 per year for a few years uh in their plan and then they've got some additional discretionary spending for a number of years here. Now, this is a starting point for them and part of the budget and cash flow process is to monitor this, adjust it along the way, but this is the starting point and so we wanted to see whether they'd be on track to funding this. They're using a balanced portfolio strategy. And if we take a look at their strategy for now from a big picture standpoint, when we go to the master charts just to see what the trend line is, what you see is that their long-term expenses are being fully funded. There's no shortfalls there.

[00:14:40]There's their travel expenses, additional discretionary expenses. Now, what's interesting, they have some health care expenses uh built into the model, and I didn't show those to you.

[00:14:50]Let's just go down to that section. And here's healthcare. And that is actually a very important part of the planning exercise. And we'll talk about that in in a little a little bit when we go through the uh the presentation. And they've got budgeted $75,000 per year.

[00:15:06]Uh and that's indexed. And that's starting in their late8s right through to life expectancy, which is age 95 for them in this model. So again, if I go back to the charts, um you can see that they have some surplus cash flows uh in this model. So that's the brown here, but that money is then being reinvested and it's actually used down the road to help with some of the health care costs.

[00:15:27]And those health care costs are showing up right there. Um, this chart just shows you where the money is coming from. And their effective tax rate, average tax rate is pretty constant throughout the model. That's the red here. And here's their net worth position. So not surprisingly, their registered accounts, RRSP RIFFs are going down over time. And their non-registered and other financial assets are going up. Now what you can see here is that they are hitting a peak in about their mid 80s and then their financial assets begin going down and that's principally because they've built in those health care costs. Their real estate in the dark blue is never worked into the analysis. They never had to use the real estate equity in in any way in this particular model. Now when we leave that what also important because we're going to talk about an aspect we refer to as guard rails in planning and cash flow monitoring. um they do have some buffer. So if we go into the recommendations tab, not a ton of buffer, but they're exceeding their goal by 18%.

[00:16:27]And if you look at, you know, what does that look like from a practical standpoint? Well, that means that they could spend another $16,000 per year in after tax dollars indexed at 3%. And not run out of money. They'd have every dollar used by age 95, but they know they have a guardrail here. Again, from a budgeting standpoint, knowing the guard rail is really important because if you consistently spend above that 16,000 per year after tax over and above the budget we've already put in, at some point it's important that you ask some questions. Is this now going to begin having a corrosive effect on our plan?

[00:17:03]Right? So, those guard rails are very important. Now, once we've entered all the data, uh, now we can look at the report. And when I talked to Sam and Sally, I gave them the net worth position. They were sitting at about $1.2 million in portfolio value. And again, here are the cash flow statements. But one of the most important documents is the cash flow projection document. Now, where this becomes really important, and there's a document here for them together as a couple, and then there's a document for them individually.

[00:17:36]And these bracketed items here are just telling us what we're taking out of the portfolio every year to fund the cash flow. So this level of cash flow funding from the registered accounts is sustainable. It's funding all their goals and they're not running out of capital. Now we're going to take this and link it up with the investment strategy. So we've put together a slide deck that actually links this particular planning to their investment portfolio.

[00:18:02]And so we're going to look at what kind of strategies we need to put in place to fund this income and do it so that they have enough income over their life expectancy that we're managing risk appropriately and linking the portfolio strategy to the game plan we've used here for the retirement income funding.

[00:18:19]Now before I get into the portfolio recommendations, I want to take a look at step four, which is have guard rails.

[00:18:26]Now, guard rails are automatic trigger points to alert you to when you might have to take some action in your planning. And so, it could be spending limits. So, defining your upper and lower spending boundaries and your projections and when you do it an update every year or you work with your retirement income planning specialist, they're taking a look at where were we planning to be by this point in the year. Did we hit our targets? If not, are there some corrective actions we need to take or are we good to just keep, you know, doing what we're doing?

[00:18:55]So that's very important. What about portfolio triggers? So set rules that may trigger some action on your portfolio. And that could be something as simple as if the market goes down 10%, now it's just a amber light. If the market goes down 20%, we're now into bare territory. Then I'm going to, you know, be very conscious of maybe having to make some changes to my draw down strategy. So maybe if I've been taking some growth from my portfolio, obviously that's curtailed. I'm going to stop taking money from that part of my portfolio and use my cash wedge to fund income. Inflation adjustments. So, we built in annual cost of living reviews and then that's going to trigger some adjustments to your cash flows over time. And then market downturns. The biggest one about that is is do not be slow or poking in your responses. So, when you see economic or market events, it doesn't mean you have to necessarily change anything, but you want to be paying attention.

[00:19:50]If I had to take a look at one of the main roles that we play for our clients when you work with them on an ongoing basis, it's that one. People want to enjoy their lives and their families and their activities and their go-go years.

[00:20:01]They want somebody else to be worrying about market meltdowns or trigger points. And that's really what our responsibility is. And then bring the client into the meeting, give them an update, and give them corrective strategies that they should give consideration to. So now we want to get into step five. This is where we're getting into some very practical action items around the portfolio. So, I'm going to show you a memo we put together that's linked directly to the retirement income plan. And we divided the portfolio into three buckets or timelines. You'll see bucket one, bucket two, bucket three in this particular image. But what we typically do is talk more in terms of timelines. So timeline one is years 1 through three or 0 to three. That's money that might be needed for short-term expenses. Has to be very conservatively invested. Timeline two would be more balanced portfolios, preferred shares, more conservative broad-based investments. It's moderate risk to lower risk. And then we've got growth assets. Timeline three or bucket three should be exclusively equities, individual stocks, ETFs in the stock market, maybe mutual funds in the stock market, but a very growthy part of the portfolio. In general, we recommend that clients have between, you know, two to three years minimum and a cash wedge just in case. And a lot of the work that should be done, whether the client does it or hires us to do it, is to make sure that these bucket strategies are kept up to date. It can involve taking profits from bucket three and pushing money into bucket two. Always watching bucket one to see whether it needs to be refilled, if it's used at certain points through the retirement journey. So, this is a very important interactive process to make sure these timelines are topped up appropriately. So here's the proposal that we put together for Sam and Sally.

[00:21:42]And this is just a highlevel summary page that gives us the timeline allocation between the three timelines.

[00:21:49]Timeline one, safety and liquidity.

[00:21:52]Timeline two, growth with protection.

[00:21:55]Timeline three, long-term growth. So when we go through the timeline allocation, um, we now can see what the allocation looks like. Now this allocation from an asset mix percentage uh perspective is exactly aligned with what we were using in the snap projections in terms of the percentage in timeline 1, timeline 2, and timeline 3. And that's how we connect the dots at a very practical level between the plan and the investment strategy.

[00:22:24]Now when you take a look at timeline one, we've got 154,754 that is allocated to this timeline. That is money that's going to be coming out of the portfolio potentially to fund cash flow. Potential investment strategies might be GIC ladders, high yield savings accounts, money market accounts. Sometimes a short duration bond portfolio can make sense. Um but in general, we're using very safe, secure uh lower return investments. Now, this is where you want to be very precise in your planning. You don't want more money in this category than required because it'll be a drag on the portfolio from both a tax and return standpoint. Now, timeline 2 is more of a balanced orientation. So, this portfolio may need to be accessed within four years. If it goes through a bare market cycle and we run out of cash here, you want to give this portfolio time to recover. And that's about almost $310,000 of the overall portfolio. And then timeline three, 100% equities, 821,000.

[00:23:23]Now, we've blacked out the investment options here just because from a compliance standpoint, we're not allowed to provide specific investment recommendations as licensed investment professionals. But when people go through this process, we do a couple of things. Number one, we take a look at their current portfolio and make recommendations on how they should change their current portfolio with their existing financial institution or advisors to be in line with this timeline. very often people want us to put together recommendations from our perspective and so we put together a customized portfolio strategy for them um to act on these recommendations. Now once we get through that piece now we're getting into where the money is coming from as it relates to the plan. So we've got the highle summary by timeline and then we're getting into funding the next three years and this is now from the SNAP projections. It's giving us a roll up of how much money we're taking out of the portfolio every year. which is really important. That's how we arrived at these numbers up here. And then we're going to take a look at the draw down strategy between Sam and Sally. Where's the money coming out? What dollar amounts to make sure that we're doing proper income splitting. We go from there now into timeline two. And again, we've got uh the draw downs here from the portfolio and the bracketed items, how much is coming out of the portfolio every year. And then we have done that individually for Sam and Sally as well.

[00:24:49]Once we put that portfolio strategy together, we now have timeline three. We know what's coming out of timeline 1 and two. That nets us from the initial starting value $821,000 of portfolio value in timeline three. And then we get down to the portfolio mix by asset and geography. And you can see that with this particular outline, we have the cash breakdown, fixed income, and then equity breakdown. Right now, the portfolio overall is about 12% cash equivalents. 9% fixed income, almost 10%, the rest is in equities. And then on this side, we're outlining on the equities part of the portfolio what the geographic breakdown is in the portfolio. Mostly, you know, US is overweight. The next largest category is Canada at 32%.

[00:25:34]Now keep in mind that this mix has been driven by the plan. So at this point we haven't gotten into discussions around investment temperament and risk aversion. So we've arrived at these numbers by saying what are your goals um that defines your budget and then your budget defines the optimized strategy in the projections using snap projection software that then determines your draw down strategy between timeline 1, two and three. We think quality investments and timeline are the best ways of defending against risk. But we do have some folks that go, you know, I wouldn't mind having a little more to fixed income or cash and become a little more defensive. These clients do have the ability to do that because they do have some surplus, but there's always trade-offs in these decisions. So the minute you go down that trade-off decision, then you might have less total return and you may have less buffer in your plan. So it's a bit of a back and forth. It's an iterative process to come up with the right optimized solution for every family. Okay, now we're at step number six, the GPS mindset. So, you want to think of your plan like a GPS system. And your retirement plan needs to recalculate just like your GPS. So, you've got this route that's established. It's the most efficient route, but then there's car crashes and traffic jams and construction going on and you have to reroute. So the first thing is make sure you're doing a review the retirement income plan or that SNAP projection I showed that should be updated at least annually and you should be benchmarking your progress against plan uh full recalibration looking at income and expenses and portfolio performance. We then have quarterly adjustments and that's minor course corrections on your plan based on spending and market activity. It may present some opportunities for profit taking as well. And then we look at dynamic planning. the plan adapts to you, not the other way around. So, life will guarantee to throw curve balls at you and so you need to be able to respond to those curve balls along the way. So, annual reviews, quarterly adjustments, dynamic planning in response to the reality that life can be a little bit chaotic sometimes. And this process will help to make sure that your plan is going in the right direction and that that cash flow plan is obviously not static. It's very dynamic and it needs to be responsive to changes in your environment. So now we're getting into step number seven and this is an important component. Precision matters.

[00:27:56]At the very beginning of this presentation I talked about it's the little things. It's the subtle adjustments or not so subtle adjustments and those adjustments that don't happen that can derail your retirement income plan. So right at the beginning we've got too much cash and then I've got optimized cash. And what I mean by that is your plan will define how much cash you need in bucket number one or timeline number one, but don't put more in that bucket than you need. So have the right amount, but don't have too much so that you're not getting suboptimal performance against plan. So that's loss compounding, lower term, you know, obviously lower long-term returns.

[00:28:37]You're have erosion of purchasing power if you have too much cash and a false sense of security. That's one of the ironic things with this kind of planning is that holding GIC's and cash or cash equivalents you that may seem like it's secure but the longer you hold on to it for many people they have another third of their life to live in retirement. So taxes and inflation and cash flow needs end up being big issues to contend with and if you're too conservative that's going to cause problems over time. So with optimized cash you align cash with actual needs. You optimize tax efficiency. You match investment strategy to the plan and needs and you let the rest of the portfolio grow. So if you look at timeline three, that was the largest part of the portfolio.

[00:29:19]That's there for tax advantage to boost performance and to make sure that you're fully funding your long-term retirement.

[00:29:25]And then step eight is one of those areas where you need to plan for just life events. So all the things I've talked about so far are reality. So having a process, a template, a structure you can follow is absolutely critical. But the GPS system is important as well, right? The GPS system will help you deal with things that are very difficult to plan for. And these are some of the more common ones that come back to surprise people, right? So you've got adult children who maybe need financial support, which is becoming more common these days with the increased cost of living. Maybe you're helping grandchildren. Uh health care costs. I did a video recently where you know health longevity is you know not that long. You know a lot of people will retire at age 65 and their health is good until age 67. So they may live a lot longer than that but their overall health not great. So health care costs are going to be there. You need to have strategies in place to deal with that and loss of a spouse. So we always say to clients when you're doing these iterations uh what happens in a first to dieice scenario if you've got a partner and now they have to deal with some of the increased costs over time. So there's a drop of income there's maybe less income splitting um overall cost may not drop dramatically and so you want to make sure you look at that particular scenario to make sure that your partner is is looked after in the event of a first to die scenario. And in the end these are not rare events particularly in a couple situations. one of these are going to happen to one of you for sure. Um, and you need to just plan in advance for them. One of the areas that I wanted to expand upon a little bit in this section of the the video is family support and the importance of setting the ground rules.

[00:31:04]Um, I'm seeing in my own practice this becoming just a larger larger issue, an important conversation that people need to have in advance. So, don't misunderstand me. I'm not saying you shouldn't help family. Uh but you need to absolutely set the rules up front. So you need to define what you'll fund and what you won't fund because the first priority here is making sure you're looking after your own financial security. And what I say to clients is before you give that gift, particularly if it's a substantial gift, make sure that you've got the financial capacity to do it uh without compromising your own income security or you know help, but what is the number that still keeps that buffer in your own planning? Um, you want to make sure that these gifts are manageable and that they're uh specific and they're not open-ended and that you need to have advanced conversations to set the rules of the game for family members. This is a really important area. It's becoming a bigger and bigger issue out there for many families with this sort of cost of living crisis that's going on, particularly for younger families. So, you thought cash flow planning was easy.

[00:32:08]There's a lot of stuff to think about.

[00:32:10]Don't let it derail your retirement plan. If you enjoyed this video, you'll enjoy the one that's on your screen right now.