Bills don’t have to surprise us.  By knowing when bills need to be paid and knowing how you are going to pay them can lift a weight from your shoulders. 

I manage my cash flow ‘within an inch of its life’.  This is one of my money management beliefs – One I believe serves me very well. In 2009 I developed my own Excel spreadsheet to manage my cashflow. I was recently separated, elected to work part time and raising two kids. I needed to know what my money was doing. I was about to buy a house and wanted to know what I could salary package to superannuation. In 2012 I made a few tweaks to my cashflow spreadsheet and still use it now.

My cashflow’s biggest advantage is I built in formulas to show me what happens to my daily balance for future months. At my stage in life I am working on reducing the amount of interest I pay to banks for my mortgage (More on that in later money tips).   I put extra payments into the repayments column and can see that I can still pay off my credit card in full and pay the next instalment for my child’s braces.

You may be paying of debt, saving for a house deposit, investing or wanting to buy your next investment property.  Whichever stage applies to you understanding your personal cash flow is very useful.

I know that maintaining daily spreadsheets to manage cashflow is not for everyone. You may prefer to find an app or keep notes in your diary – paper or electronic. Method is not what matters – it is the resulting benefits that make it all worthwhile.

Understanding my cash flow has given me an excellent credit rating and enables me to make additional weekly repayments on my mortgage.

Setting short term goals enables me to benefit from gizmos, gadgets and holidays in me and my family’s life.

At times I do access the ‘extra payments’ I have made on my mortgage – to take my family overseas for example. I understand this partially reverses my diligent efforts. I also understand that giving my family experiences of life and the world is immeasurable. 

Do you have an understanding of your personal cash flow to assist you live the life you love?