Strategic Accounts Modelling and Conditional Account Transfers (Flow of Funds)
When looking to the strategic aspect of modelling your clients, at Prospera we believe one of the keys to improving the financial position of your clients is to incorporate a more efficient cashflow structure.
By flowing all surplus cashflow towards debt reduction, you are able to minimise interest costs on loans, which then helps you maximise the wealth creation benefits of the client's cashflow, such as creating additional income, investing in growth assets, and, where possible, reducing income tax.
To establish a more efficient use of cashflow, we can set up automatic transfers between accounts to occur at specific times. These are known as CONDITIONAL TRANSFERS, and they are located beneath the list of accounts on the client's ACCOUNTS screen.
In the case of Sam and Samantha Sample above, we have created an Offset Account to hold a buffer of cash up to $5,000, and once $5,000 has been accumulated in the Offset Account, surplus cashflow will be directed towards reducing private debt.
Following repayment of all private debt, all surplus cashflow will then be directed to paying down investment debt.
Ultimately, once all debt has been repaid, surplus cashflow will be directed to a Cash savings account.
By clicking on the dropdown menu beside the accounts shown in the CONDITIONAL TRANSFERS section of the Accounts screen, you can set the accounts you wish to transfer to, and the limit at which you would like transfers to occur.
Once you have set up the transfers, click on the blue UPDATE button below the Conditional Transfers.
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