Cash Flow Management

Free CFP Exam lesson in General Principles of Financial Planning. 17 min read, ~2,484 words.

Here are the bottom-line rules for cash flow management. First, the emergency fund target is three to six months of essential expenses for stable dual-income households, and six to twelve months for single-income, self-employed, or variable-income households. Second, the denominator is essential expenses, never gross income, and that is the...