Manage your cash flow

Create a cash flow pecking order to keep your money in check

This is a simple concept with powerful results. It will help you manage your cash flow in the best way for your family. But, it’s not always easy to rate the competing interests you have on your cash flow. They vary from time to time throughout the year, but there are some keys items that are top of the list all year round.

My oberservations based on my own habits and how I see my clients making spending decisions gives me insight into the cash flow habits of many people.

Creating a Pecking Order of most important expenses to least important will help you prioritise your spending. You will then have enough money on hand to pay bills as they arrive. Sometimes you have to make tough decisions as to how to allocate your cash flow, there isn’t always enough money for everything.

Items that may head your list could be;

• Home loans payments
• Savings
• Health care
• Personal loan and credit card payments
• School costs
• Running the car(s)
• Utilities
• Groceries

Least important may be;

• Buying your lunch everyday
• Uber eats
• Unused subscriptions or services
• Replacing items before the end of their useful life
• Eating out too often
• Too many trips to the cafe ( or should this be at the top?)

NB:Reducing spending on the least important items will help fund the most important items.

Then there is the vast grey area in between, which is so big I won’t even try to tackle it. But, you need a strategy to help you decide where you spend your money, and no, upping your credit card limit is not the answer.

Getting some sense into the above, will help reduce some of the financial stress of living today and help you manage your cash flow effectively.