The shock result of the EU Referendum has certainly turned things upside down. What was an unexpected result in many people's eyes has left those both in the remain and leave camps uncertain of what lies ahead for the British Economy.
Apart from the immediate impact on our holiday spending money this year, it is too early to predict how things will pan out, although without a doubt this degree of uncertainty will naturally make potential investors more cautious with where they place their monies and how we in general react to unforeseen changes in the economy.
However, this doesn't have to be all doom and gloom, as any change brings with it new opportunities. In the aftermath of this post Brexit "confusion" it's likely that both existing and potential new clients, are indeed likely to need financial planning more than ever before.
The use of cash flow modelling providing clients with an overview of their current and future financial position could become increasingly valuable to clients. Generating a comprehensive projection of income and expenditure along with liquid assets is an effective tool to provide clients with a greater understanding of their financial future. Although this type of analysis will never be 100% accurate given the number of assumptions made such as inflationary increases and investment growth, it will nevertheless help clients plan for the future. Incorporating various "what if" scenarios of occurrences that could possibly happen will further assist clients to prepare for future eventualities. Not only is this valuable for clients' understanding of their current and future financial position, it is likely to open up potential opportunities for business, perhaps highlighting protection shortfalls and the need for future savings.
It may also be a good time to review clients' current arrangements. Ensuring clients have a diversified portfolio which is aligned to their risk profile, objectives and circumstances over the longer term is particularly important in this current period of prolonged uncertainty.
This is particularly important for those approaching or already in retirement via drawdown. Discussions and advice around generating and sustaining an income along with the options available will be invaluable.
In addition, the recent further reduction in interest rates to a record low is likely to encourage additional/new investments rather than holding large amount in cash.
Overall, although the impact Brexit will have on the economy is uncertain, there is a degree of positivity in respect of the potential opportunities thing may bring.