Personal Cash Flow Statementis an indicator of

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Description

This indicator is the cash flow of a client, calculated by subtracting the client's total expenses and total savings from their total income. "Financial literacy and counseling programs should work with their clients to build a cash flow statement to track and monitor annual and monthly financial behaviors". Compute the cash flow by subtracting the client's total expenses and total savings from their total income. The remaining cash flow should be adjusted monthly and compared to previous monthly statement. Clients that increase savings, manage to spend less than they earn, and do not show a deficit show progress in demonstrating positive financial management behaviors. Households that have fixed or committed expenses under 65 percent of total income, and discretionary spending below 10 percent of income, tend to be in the strongest financial condition (Welch, 2010). This indicator has been identified by PerformWell as a suitable indicator for measuring cash flow management in: - College - Young Adults - Adults - Older Adult For more information see: http://www.performwell.org/index.php/find-surveyassessments/personal-cash-flow-statement. Self-reported questionnaire and interview

Compute the cash flow by subtracting the client's total expenses and total savings from their total income. The remaining cash flow should be adjusted monthly and compared to previous monthly statement. Clients that increase savings, manage to spend less than they earn, and do not show a deficit show progress in demonstrating positive financial management behaviors.Households that have fixed or committed expenses under 65 percent of total income, and discretionary spending below 10 percent of income, tend to be in the strongest financial condition (Welch, 2010).
Source

Welch, Evan, P. Building a Personal Cash Flow Statement, Posted on May 24, 2010. Financial Planning Association, Accessed on 1/3/2014 at http://www.fpanet.org/ToolsResources/TipoftheWeek/PastTips/Other/BuildingaPersonalCashFlowStatement/

TypeObjective
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