Cash flow management is a system, not a budget. It will allow you to see your financial situation from a long-term, systematic viewpoint. You will see how one move, such as periodic tax payment, can affect your disbursements for several months prior to, and following, the actual payment. Budgets are too immediate in scope to allow you to relate a March income to a July expense. It is essential for you to begin a systematic savings and investment program to accomplish financial and retirement goals.
Every successful business relies upon a system to control income and disbursements.
Your personal financial situation is comparable to that of a business, and no less important. The purchase of a pleasure boat in three years or the decision to remodel your basement next winter should influence your cash flow plans. The goals that you have already set should help you shape your personal version of this system, so it is important to refer to them often. Identify and isolate income and expenses. Define the kinds of income you receive and the kinds of expenses you incur.