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Determine Your Net Cash Flow

Lesson 10 Chapter 1 Module 3

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Welcome back. You already know how much money you have coming in and going out, now it’s time to determine your net cash flow. Your net cash flow is this simple formula:

Net Cash Flow = Actual Income - Actual Expenses

So based on the work you did in the previous lessons, what is your net cash flow?

Is your net cash flow a positive number (so you have a surplus) or is it a negative number (so you have a deficit)?

It’s important to complete your cash flow statement because it provides the foundation of your spending plan or budget. 

Your cash flow statement tells you your actual income and spending, whereas your budget is your projected income and spending. So if you find a deficit exists (because more cash is going out than what comes in during a given month) you have to analyze where you need to cut back when creating your budget.

Also, consider ways to increase your income. Some sources of additional income include:

  • Working extra hours at your current job
  • Getting a part-time job
  • Creating a home-based or online business 
  • Selling unneeded household items or clothes online or in a yard sale
  • Turning your hobby into a business
  • Selling your advice or expertise as a consultant

Finally, you can try searching online for additional ideas for extra income. One of the easiest ways to earn some income from home is to get paid for sharing your opinions.

There are several companies such as Opinion Outpost, KashKick, and MyPoints that will pay you for your opinion.

You can do things from answering surveys to watching videos, and other easy tasks for you to choose from. Your insights help companies grow, so they are happy to pay you for your time and effort. Complete as many as you'd like - there's no limit! Therefore, I recommend you sign up with as many sites as you would like.

In the next lesson, we’re going to work on making your spending plan…I’ll see you there!

Your Actionable Steps For This Lesson:

  • Calculate your net cash flow (use the same worksheet from the last lesson)
  • Analyze your current spending to see what areas you can cut back and save more money
  • Brainstorm some ways you can increase your income


What did you learn about your spending from analyzing your net cash flow? Let me know in the comments.

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