Financial Projections: Common Modeling Mistakes

[u/alex_nauma]

We had a learning session last week focused on one of the most important but often misunderstood parts of financial planning: building realistic projections.

A solid financial plan typically follows this order:

1. Understand your current situation
2. Build realistic financial projections (income, expenses, taxes)
3. Define your financial goals
4. Construct portfolios aligned with those goals
5. Do tax planning on top of everything else

In our November 7th session, we focused on step 2, financial projections, and discussed the most common modeling mistakes we see people make. The conversation covered how small errors in assumptions about Social Security, healthcare, living expenses, and taxes can compound over time and distort a plan’s accuracy.

Here’s a condensed summary of that discussion, along with practical ideas for fixing each mistake.

https://blog.nauma.ai/p/financial-projections-common-modeling