Cash Flow
The net amount of money moving in and out of your accounts over a given period — positive when income exceeds expenses, negative when it doesn't.
Cash flow is the most fundamental metric in personal finance. Positive cash flow means you have money left over to save, invest, or pay down debt. Negative cash flow means you're spending more than you earn, which is unsustainable long-term. Tracking cash flow monthly reveals seasonal patterns (holiday spending, annual insurance premiums) and helps you plan ahead. It's different from net worth — you can have a high net worth but negative cash flow, or vice versa. Assetli's analytics provide a detailed cash flow breakdown by category and time period.
Example
In March, your income was $5,500 and expenses were $4,200, giving you a positive cash flow of $1,300 for the month.
Try in Assetli
Read more
Related terms
50/30/20 Rule
A budgeting guideline that allocates 50% of after-tax income to needs, 30% to wants, and 20% to savings and debt repayment.
Fixed vs Variable Expenses
Fixed expenses remain constant each month (rent, subscriptions), while variable expenses fluctuate based on usage or behavior (groceries, dining, fuel).
Savings Rate
The percentage of income saved or invested rather than spent, widely considered the most important factor in building wealth.
Net Worth
The total value of all your assets (cash, investments, property) minus all liabilities (loans, mortgages, credit card debt).
Explore more terms
Envelope Method
A cash-based budgeting system where money is divided into physical or virtual envelopes, each assigned to a specific spending category.
Zero-Based Budgeting
A budgeting method where every dollar of income is assigned a purpose, so income minus expenses equals zero.
Lifestyle Inflation
The tendency to increase spending as income rises, preventing growth in savings and wealth despite higher earnings.
Emergency Fund
A liquid cash reserve set aside to cover unexpected expenses or income loss, typically 3–6 months of essential living costs.
Transaction Categorization
The process of classifying financial transactions into categories like groceries, rent, or entertainment to analyze spending patterns.
Recurring Transactions
Transactions that repeat at regular intervals — subscriptions, loan payments, salary deposits — essential for predicting future cash flow.