Understanding Cash Flow

What is cash flow? It's actually very simple. You understand how much money comes in and how much money goes out.

You've heard the old saying, "living paycheck to paycheck?" This saying actually describes the situation that arises from having a zero net cash flow. In other words, you spend everything you make, leaving you with nothing left over.

Ideally, you want a positive cash flow. Meaning that after you've paid everything, you have money left over. This is what Memaw calls, "living below your means."

Well, after taking a hard look at my expenses list, I see that we are actually doing a thing far worse than living paycheck to paycheck. We are coming up short from paycheck to paycheck! We have a negative cash flow. This means we are borrowing to maintain our current standard of living. Bad Bad and Bad.

By putting a lot of expenses, such as restaurants and gas on credit cards, we are actually financing our expenses plus interest no less!

As I'm still gathering the As-Is picture by collecting credit card statements, I'm not quite ready to figure out the family budget, but I am going to look at the expenses I can eliminate today before I go any further...I'm looking for any positive movement at this point.