By now you have the bulk of your budget figured out, it’s all coming together.  However, it likely feels like you don’t really know where money is going and when.  That is normal at this point. We are now going to put it all together from a cash flow perspective, which is when we determine how money moves.

Now that you have your monthly budget you will need to designate when certain expenditures will be paid.  It is normal for certain bills to be due at certain dates. It’s also normal that income is coming into your accounts on certain dates.  So now I want you to put that all together.

Feel free to put this cash flow portion of things into a spreadsheet, on a piece of paper, or into budgeting software.  The bottom line is that you should have your source of income dated and designate what outflows will come from each specific income line item.  For example, if you receive a bi-weekly paycheck you will specifically designate what outflows come from each check. I encourage basing the income off the lowest possible amount.  You should also project out many months to know how things are projecting into the future.

If you are commission or self-employed then the income will be sporadic and you will most likely choose to consider each month entirely still (that is what I do).  You will know what needs to outflow each month, what your mandatory income is for that month, and given your priorities for excess list the rest is taken care of as well.  I encourage you keep at least a minimum balance in your operating account (aka, primary checking account) that is equal to your monthly minimum mandatory expenses so you’re covered as a baseline.  You will also need to keep a separate savings account for taxes (income, self employment, payroll taxes, etc.) to ensure there are no surprise outflows.

For all readers, I suggest you at first keep a minimum mandatory balance in our primary checking account equal to your monthly total of minimum mandatory expenses until you get used to how to handle your cash flow.

Here is what an example cash flow budget may look like:

2269 pay
-310 tithe
-130 phone
-55 internet 20-Jan auto w/d
-85 utilities 23-Jan auto w/d
-1360 mortgage 24-Sep
-200 groceries
-80 gas
-220 slush
2269 pay 28-Dec 11-Jan
-310 tithe
-43 ins 1-Jan
-200 groceries
-80 gas
-220 slush
2269 pay 12-Jan
-310 tithe
-130 phone 14-Jan auto w/d
-55 internet 20-Jan auto w/d
-85 utilities 23-Jan auto w/d
-1360 mortgage
-200 groceries
-80 gas
-220 slush
2269 pay 25-Jan 8-Feb
-310 tithe
-43 ins 1-Jan
-200 groceries
-80 gas
-220 slush
2269 pay 8-Feb 22-Feb
-310 tithe
-130 phone 14-Jan auto w/d
-55 internet 20-Jan auto w/d
-85 utilities 23-Jan auto w/d
-200 groceries
-80 gas
-220 slush