Stay on Track of Finances with a 90-Day Cash Flow Forecast

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Transcript:

Most coaches won't really reveal some of their mistakes, but I'm not most coaches. You have to know what cash you have coming in and going out from your business. It's critically important, and a matter of life and death.

I had a situation where I looked at my Wells Fargo account and I know the number was $305,000 and all of a sudden, 4 months later, that number was $27,000.

I don't have exact documentation, business was slow and I didn't have a separate business buffer account, but I just remember that being a weird feeling not knowing what happened to $280,000. It was a good and bad thing, because we were growing and I was trying a bunch of things in marketing and seeing what stick.

This 90-day cash flow forecast, I don't want you to over-complicated this, but I want you to make an appointment with yourself every week to do this with yourself. I have a tool that does this automatically, but it has to be done on a regular basis no matter what.

In this cash flow forecast, you are looking at 3 months of income: always the current month and the next two months. I had two sources where I kept business cash. This chart also details your projected cash inflow and projected cash outflow. This will allow you to figure out your net cash, at the end of the current month, 2 months, and 3 months. By doing this, you can avoid my mistake. 

Once you get this set up, it won't take a lot of time. Once you get this ingrained in you, you'll understand why it's so important to look at your cash flow 90 days out all the time.