You’re working long hours to bring home the bucks, yet for some reason, your credit card bills never shrink, debts don’t decrease, and you actually find yourself slightly worse off than the month before. What’s going on?

Time to grasp the inflow and outflow of your money:
Cash flow statement.

1. determine your monthly income (tally the following)

net take home pay
tips, commission, bonuses, overtime
second job
alimony, child support, social security
income from rental property
(some people chose to add income from trust accounts and dividends from investments)

TOTAL MONTHLY INCOME: ______

2. determine your monthly expenses (tally the following)

taxes (federal income, state, FICA, property)

housing
• mortgage or rent
• utilities
• homeowner/renter insurance
• internet, phone, tv
• home repairs

auto
• loan/lease
• gas
• repairs and service
• insurance
• parking/tolls
• mass transit

food
• groceries
• restaurant
• snacks, liquor, morning coffee

insurance/medical
• life insurance
• health insurance
• other insurance
• doctor visits
• medications

household
• home items (like decorations and furniture)
• lawn and garden
• cleaning service or supply
• security system
• clothing
• cosmetics
• hair care
• pets
• vet bills
• club memberships
• vacations
• education
• entertainment
• hobbies
• books/magazines/newspapers
• gifts
• computer/technology

misc
• credit card payments/interest
• loan payments
• child support and alimony
• stamps
• church/charity contributions

total expenses: _____

**We never remember how each penny has been spent. Sometimes, I look at the credit card bill and think, “What did I buy?” Therefore, many financial planners suggest multiplying expenses by 1.1 (110%) to account for the missing money we can’t seem to keep track of. The point is that for every dollar we spend, we also spend 10 cents that we can’t quite account for in our cash flow statements.

TOTAL EXPENSES x 1.1: ______

_____________________________________________

3. Compare the difference
Total income – total expenses = net cash flow

The net cash flow is remaining money you can spend, save, or invest. On top of that, you’ve now inventoried your money. Is the money going to restaurants a bit high? How about entertainment? Here’s a chance to start tweaking and saving.