There’s a tendency to focus too much on what our income is, and not focus enough on what our expenses are. Cash flow takes both of these into account, and it’s easy to see at a glance if you're moving in the right direction.
Bayside, N.Y. (PRWEB) February 05, 2013
Personal Finance expert Walter Edelstein, CFP® has published new timely content on BankingAdvice.com on how consumers can use cash flow to plan for the future. Consumers need to get objective information on best practices they can use to improve their financial situation. BankingAdvice.com is one of the sites that are part of TheAdvice.com Personal Financial Site Network that provides consumers with free information and easy to implement practical ideas to help them achieve their personal financial goals. Following is a summary of the new article which is one of the many “How to” articles that have been published on TheAdvice.com Personal Finance Site Network.
Cash flow analysis is an underutilized but extremely important element of personal financial planning. In its most basic form, cash flow is a measure of an individual’s total income versus their total expenses over a certain period of time. By incorporating a number of different financial measures into a single number, cash flow can help an individual plan for their future.
If a consumer never calculated cash flow before, they shouldn’t spend countless hours making sure every last cent for every account is in their budget. The point of a cash flow analysis is simply to gain an understanding of how overall income compares to expenses. This cash flow analysis is central to planning for a successful financial future.
Use Cash Flow to Judge Financial Health. We often tend to focus on the wrong things when we evaluate our financial health. Or, more accurately, we only tend to focus on part of the equation. According to Mr. Edelstein "there’s a tendency to focus too much on what our income is, and not focus enough on what our expenses are. Cash flow takes both of these into account, and it’s easy to see at a glance if you're moving in the right direction." An individual’s financial health is likely to be good when cash flow is positive, while a negative cash flow is likely indicative of poor financial health. Knowing where an individual stands now can help one plan for the future.
Click here to read the complete article on BankingAdvice.com.
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TheAdvice.com Personal Finance Site Network was launched in 2009, and since then has provided consumers with hundreds of free articles and financial tips across a broad array of personal finance topics. Several of the sites in TheAdvice.com Personal Finance Site Network include:
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Mr. Edelstein has financial experience that spans over thirty years. It includes being a Certified Financial Planner™, having a Master's Degree from Columbia University, and having served as Chief Marketing Officer for a major online bank where he honed his online marketing skills to help consumers achieve their financial goals.
TheAdvice.com proudly reaches out with this network of personal finance websites to help individuals and families discover the path to financial knowledge.