Cash Modeller and Risk Profiler

Question 1

Cash model

Pros

Income now v income retire 
Stress test scenarios 
Predict shortfall and plan 
Uses assumptions for growth and inflation 
Amendable 
Suitable asset allocation 

Cons
Assumptions maybe incorrect 
Inflation too high 
Charges too low 
Growth rates  too high 
Returns lower than expected 
Market crash 
Tax rules change 
Liquidity risk 
Income/capital withdrawal higher 
Live longer 
Requires regular reviews 
Difficult take account of risk

Answer 1

Risk profile

Pro
Easy simple to understand
Clear objective
Identifies max loss

Cons 
May not understand terminology 
Adviser may misinterpret
Snapshot in time 
View may change 
Not real life tax and charges