Personal cash flow

Training 35 minutespersonal cash flow

You are 27, a nurse taking home $2,800 a month. Every month the card hits zero by the 25th and you cannot tell where it goes. Let us map the flow: what comes in, what goes out, and when.

Training goal: Turn your cash flow positive

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Situation

1. Where to start? You have 3 months of card statements and a notebook.

Just spend less starting next month
Sum up every inflow and outflow from statements
Grab a complex 40-category spreadsheet

2. The statements show a $600 insurance bill once a year and $150 for car service every quarter.

Ignore them, they are not monthly
Pay them with the credit card when they come
Spread them out: $100 a month

3. Pay lands on the 15th, but $1,100 rent leaves on the 1st. The first half of each month runs on leftovers and the credit card.

Ask the landlord to move rent to the 16th
Take a payday loan until the 15th
Change nothing and scrape by

4. You trim the extras and the flow reaches +$240 a month. Where does it go?

$150 to the card debt, $90 to a cushion
Leave it on the card, just in case
Finally sign up for a gym and meal delivery

What you will learn

Cash flow is income minus spending for the month
Divide rare bills by 12 and save for them ahead
Payment timing matters as much as amounts

Your real-life step

Open last month’s statement. Add up all money in and all money out: is your flow a plus or a minus?

Questions and answers

What is personal cash flow?

The difference between money coming in each month and money going out. A positive flow builds savings, a negative one leads to debt.

How do I calculate my cash flow?

Add all take-home income for the month and subtract all spending, including a share of yearly bills. A 3-month average gives the clearest picture.

What do I do if my cash flow is negative?

Find your largest expenses, move bill dates closer to payday and look for ways to earn more. New debt never fixes the flow.

▶ Play this training Track your budget in Hanimani

More trainings in this module

Numbers are illustrative. A game, not financial advice.