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there’s more available cash the end of each month this would suggest that the income for this entity or for this household if this was a household is greater than the money out if the money out was actually greater than the money in so if I change some of these figures here then available cash would actually be shrinking it would be negative at the end of each month and so just changing this you can see it’s coming down 30 27 25 22 so if this was your household cash flow statement or if this was a company cash flow statement you would be getting concerns it looks like at the other four or five mobs time there’s actually going to be no cash left in the business why is this a concern because cash is king if you run out of cash you’re going to go bust and it’s the same in a household if you’ve run out of cash you can’t pay your bills

what happens you could face bankruptcy you can’t make your financial commitments now in order to improve cash flow for a business or entity looking at it from an accounting and Finance perspective there are a few options you can cut the money going out of the business you can make cuts you can lower your expenses lower the money going out you can increase the money coming in and that’s your two main options really is to increase the money coming in or decrease the money going out now giving to a household or relating this to a household how could you improve cash flow for your household it’s the same sort of things you can cut your money going out you can try and budget better spend less money if you are making big mortgage payments big debt payments you could try and renegotiate a better price you have less money going out each month alternatively you can increase your income you can try and get a better paid job or you can get a second job look at your income streams and try and increase them hopefully that makes sense that’s the basics of cash flow forecasts

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