A cash flow statement is a detailed look at all money coming in and going out over a period of time. It illustrates what you earn (revenue) and what you spend (expenses). Your net cash flow is expressed as: Net Cash Flow = Revenue – Expenses. That is, what you earn minus what you spend.

Some examples of revenue include: salary and wages, self-employment earnings, dividends, interest, and other investment income. Expenses may include: mortgage payments, rent payments, insurance costs, utilities, clothing, food, child care, alimony or child support, travel, entertainment, loan payments, education costs, taxes, charitable contributions, gifts, and gasoline. After listing all you earn and everything you spend, you can calculate your net cash flow by simply subtracting expenses from revenue.

By analyzing your cash flow statement, you can more easily cut expenses and identify excess net cash to use towards your goals. Generally, someone with negative net cash flow should first concentrate on cutting expenses to achieve positive cash flow before attempting to save or invest towards any future goals. Once positive net cash flow is achieved, excess money can be used directly for funding and achieving your goals.

In developing a balance sheet and a cash flow statement, it is important to remember one general rule-of-thumb- Quality in – Quality out. The more detail and care you put into your planning documents, more effective they will be. A plan is only as good as effort you put forth when creating it.

Federal PLUS Loans Are Supplementary In event that your parents are approved for Federal PLUS Loan that they apply for, they will then receive either what they have requested to supplement other loans and scholarships towards your college tuition. Or, government may decide to only give your parents less than what you have requested due to their credit history. It is important to remember that, although your parents are ones requesting a loan for your college, you should also seek out other options for paying your student tuition, because PLUS Loans often do not cover entire tuition. Scholarships and other types of loans are often available for college students. Seek out all possible options before settling on a PLUS loan.

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