Topuc 4 Flashcards
(14 cards)
A five step cash flow plan
- Identify sources of income
- Identify expenditure
3.decide on a planning time period
4.compile a cash flow chart
5.total income-total expenditure =surplus/deficit/balanced
What is known as the difference between expected and actual figures
Budget variance
What is the key to effective monitoring
Analyse the cause of the variance
The simplest way to monitor your budget l?
Keep receipts use them with , bank statements
What are some free online planning tools
- Budget planner (Money helper)
2.Money dashboard - The debt advice foundation budget planner
4.Money saving experts budget planner
What are some paid for online planning tools
- you need a budget
- Moneydance
- goodbudget
Oraganised people
Those who always keep receipts and other financial documents , and who keep records about how much they earn and spend
People who are less organised
They may simply jot down a few figures on the back of a envelope to see how much they have spent and have left before next income
People who do not forward plan
Might do a few mental calculations and check their current accounts this approach is very hit or miss
Zero based budgeting aims to what
Every penny of your income is spent purposefully and wisely
Zero based budgeting is what
A more recent version of the envelope method
What do you do for a zero based budgeting
Draw up a detailed cash flow forecast allocating every penny of your expected income to a different envelope
What’s the preferred time period of all the expenses a zero based budgeting should cover
12 months preferably
What are opportunity costs
The value of what you had to give up to consume something else
