Author: Clay Hillary
The term “cash flow” is often heard when the financiers referred to money and how it has generated and spent. What is less known is that this concept can also be usefully applied to our individual economies.
Did you open your wallet at the end of the week, and to his surprise, found in the interior, only $ 2? To make matters worse, he knows that on Monday morning, had gone to an ATM to cash out as much as $ 100 from your checking account. Where did that money end up?
In the hustle and bustle of everyday life, it’s easy to lose track of where our money goes. Unfortunately, it is very difficult to develop a financial plan, unless you know how much money you have and where it plans to spend this money effectively. This is called your “cash flow”. Knowing you, you can help you decide in a realistic way what your financial goals, and how long it will take to reach them.
Get a calculator and be prepared to learn how to win and how you spend your money.
Your earnings
Not all revenues are included in the monthly salary. Money can reach into their pockets from a variety of sources, including interest from bank accounts and investments. To calculate your income, then, needs to identify all the ways you get money every month, and year-round. Write down your monthly earnings and annual income.
Your Expenses
Make an accurate list of costs can be difficult, because it is very easy to take cash from the ATM, or pay with a credit card, and then lose control of how we spend money really. In addition, most of us have associated costs, such as the purchase of cleaning supplies, haircuts, or pet care, which are very easy to forget, but always add to our account.
To begin recording your expenses, write down the monthly costs. As you can see, the fixed monthly costs are divided into a variety of categories. Feel free to add or delete categories according to their consumption habits. You can include the cost of your spouse or partner in this book, or do it separately in another scorer.
Now, remove the annual expenditure. You can include the cost of your partner in this book, or make a separate list for him or her. Feel free to add or delete items according to their consumption habits.
Help: If you are having problems in evaluating all your daily expenses, try to keep track of all the money you spend for a week, or month. Every time you take out some bills from his pocket, record spending and the item purchased. At the end of the month, add these purchases “spontaneous.”
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