The importance of cash flow in financial planning


MINT HILL, NC – As we continue our journey, this week’s article is about cash flow. We like to think of cash flow (budgeting) as a way of life, not a diet. Don’t try to balance your cash flow like you’re on a crash diet. Think of when you go on a diet and try to cut out the french fries, but as soon as you get sick of that diet, you go right back to your old habits. Budgeting should be more of a way of life.

At Fulcrum, we like to think of the financial planning process as building a house. The most important part of a house is the foundation. Cash flow analysis is essential, as is the foundation! There are two types of expenses. Principal and discretionary. Examples of basic expenses are your mortgage/rent, utilities, food, etc. They are required to live. Now let me say that you can reduce these basic expenses, but they are still necessary. Discretionary spending includes all the other things we spend money on that are not essential. For example, going out to eat, going to the movies, making a donation, etc.

Let’s start by setting a budget. Income – Expenses = Lifestyle. If you would like to take the first step in planning, please let me know. I am happy to help you.

Let us help you find your clarity of purpose!

To discuss further, please contact me at (704) 817-4480 Option 2, or by email at [email protected]


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