Section 2.1 Your Personal Financial Landscape 41
Evaluate Your Budget
From time to time, review your overall money management plan to make
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significant events in your life. These events include going to college, starting
a new job, leaving home, getting married, having children, and changing jobs.
Consider the following questions as you evaluate your budget.
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planning?
When revisions are needed, make the necessary changes to update your
budget. Recheck in a week or two to see if the new entries are an improvement.
Monitor your finances carefully to make your income work well for you over
the years.
Cash Flow Statement
A cash flow statement is a summary of the amount of money received
and the amount paid for goods and services during a specific period. The
cash flow statement shown in Figure 2-7 appears very similar to the budget
statement shown earlier. However, there are important differences. In the
cash flow statement:
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The cash flow statement goes beyond the budget to reflect actual money
inflow and outflow for the month. Prepared at the end of the budget period,
it shows real income and spending, not what was planned.
To get accurate figures for the statement, record cash inflows and outflows
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Quick Tips for Better Budgeting
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Keep it simple.
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Write it down.
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Be specific.
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Be flexible.
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Be disciplined.
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Keep it all together.
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Be prepared for the unexpected.
Goodheart-Willcox Publisher
Figure 2-6 When planning a budget, keep these tips in mind.