Question

Ted is a single guy who’s living the good life. The spreadsheet below shows Ted’s cash flow for a month. A 2-column spreadsheet showing Cash Inflows and Cash Outflows. Cash inflows are Disposable income 5,000 dollars, interest on deposits 0 dollars, income from investments 225 dollars, with total cash inflow 5,225 dollars. Cash outflows are rent 3,000 dollars, utilities 250 dollars, satellite dish 175 dollars, cell phone plan 135 dollars, car lease payments 385 dollars, groceries 200 dollars, insurance 380 dollars, recreation 700 dollars, with total cash outflow 5,225 dollars. Based on his monthly cash flow, explain what part of Ted’s financial plan might be missing and why.

Answer 1

It should be noted that Ted is not saving any money, therefore he may be missing a budget. This is evident from the fact that his total cash outflow for the month is equivalent to his total cash inflow.

Whats is a budget?

It should be noted that a budget is an estimation of revenue and expenses over a period of time and is usually compiled on a periodic basis.

It should be noted that budgets can be made for a person, a business, a government.

Based on the information, Ted is not saving any money, therefore he may be missing a budget. This is evident from the fact that his total cash outflow for the month is equivalent to his total cash inflow.

Learn more about budget on:

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