The smart way to view your cash
How your household cash flows A quick tour Your net cashflow Compare YNACP vs. budgeting
Cashflow is income and expenses over a future period of time. Cashflow is normally measured on a monthly basis. Net cashflow is the amount of cash remaining after expenses are subtracted from income as shown below.
In your cash plan, the Net cashflow row, as highlighted below by an arrow, is the measure of how well you are managing your household cash flow.
A positive net cashflow (in the black) indicates that your income is the same as, or more than your expenses. You are living within your means. A consistently positive net cashflow over the coming months could indicate that you have extra income available to put toward your financial goals.
A negative net cashflow (in the red as circled above) shows that you plan, on the spreadsheet column date, to use more money than you expect to have available. You are living beyond your means. A consistently negative cashflow is corrected (made positive) by increasing income and/or reducing expenses (spending, bills, credit card charging, set-asides to sinking funds and savings).
With your net cashflow projected twice a month for the next twelve months in your cash plan, you can take appropriate steps to correct any planned overspending (red net cashflow) before a future shortfall becomes today’s problem.
Day-to-day your net cashflow also shows you how much you have available to use with your credit cards. When you add new charges and schedule payments to cover those charges, the money for the payments is deducted from your net cashflow.