During your wealth accumulation years, the goal of cash flow management is to provide adequate funding for future spending needs. These include funding children's college educations and creating enough wealth to provide a stable income when you decide to no longer earn a salary. It also includes building an adequate emergency reserve and setting aside savings for more frequent needs like car purchases, repairs, and vacations.
In retirement, the goal of cash flow management is to provide a shock absorber to buffer your day-to-day financial needs from the normal fluctuations in your investment portfolio.
At Kahler Financial Group, our 30 years of experience in managing investments gives us actual experience in all market cycles on which we can base a realistic estimate of investment returns and retirement income. We encourage clients to make retirement plans based on what research shows to be sustainable withdrawal rates. This will give them the greatest chance of preserving their assets and providing stable income throughout their lives.
Our fundamental strategy is to provide a smooth and continuous cash flow in a well-diversified portfolio with a broad range of asset classes. In addition, we help clients plan for retirement well in advance so they are prepared for the transition from accumulating assets to using assets. We typically structure retired clients' portfolios to keep two to four years' expenses in cash to protect them from market fluctuations.