Cash Flow versus Disposable Income
Our Way - Everyday Cash Flow
Cash flow is the timing of your income and expenses.
When we look at cash flow we see money in motion. As financial consultants, we analyze where the money is coming from and advise you on where it's most needed to pursue your financial goals.
At Money Counts we know that everyday cash flow can be adjusted to build the maximum flexibility into your payment schedule. Our consultants walk you through an analysis of where your money is currently being spent and how spending aligns with the timing of income. We look at your short and long term goals and help you prioritize your spending plan to improve your potential to maximize wealth building results. We will also show you how to use the assets you have accumulated as resources to create additional value.
Eliminating Money Leaks
A money leak is any money spent that is a value-less expenditure. We identify and help stop money leaks to improve cash flow.
For instance, we often find leaks in overlapping insurance policies that increase premiums but not coverage. Another significant area of leaking money is automatic inflation adjustments for property value that may have overvalued your property and increased your premium.
We can help identify where you can save money by analyzing your coverage to determine what's needed and what's not. Our consultants will train, explain, and offer options that many financial advisors may not be trained to offer.
Their Way - Disposable Income
Disposable, or discretionary, income is often defined as the amount of money left over after all of your necessities have been paid - food, rent, clothes etc. We believe that there are opportunities for improvement in managing both your disposable/discretionary, and your remainder/non-discretionary expenses. For instance, we believe that everyone would agree that income taxes are non-discretionary expenses. However, we are able to manage when we want to pay our taxes, by making adjustments to our payroll withholding or estimated tax payments. If you like to receive a big refund, you can increase the withholding amount. If you prefer to have more of your cash flow paid to you during the year, you can decrease the amount of your tax withholding. In either case, be sure to work with your tax advisor to estimate your potential tax liability for the year that you are making the adjustment.
Having enough cash flow to meet today's financial commitments while putting money away for future needs like college or retirement can be daunting, even in the best of circumstances.
But maybe there is more control over non-disposable expenses than is readily apparent.
* This does not represent financial advice. It is intended for clarity purposes. No financial advice will be offered by Money Counts until we have a complete understanding of your individual financial picture. Diversification does not ensure a profit or protect against a loss in a declining market.