Personal Finance: Cash Flow and Budget Management | finpins.com For Video: https://www.youtube.com/watch?v=tkgekedXbE8&t=2s https://finlightened.com

1. Take Control of
Your Finance
Pin 1: Cash Flow
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Sumeet Sinha

2. About me
Education
• Chemical Engineer
• MBA Finance, Analytics Emory University
Globetrotter: Lived and Worked in 3 countries
• India
• USA (Atlanta, Miami)
• Luxembourg
3 Corporate Jobs
• 8+ years in total, latest being at Amazon
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3. 4 Pins on your
(mental) board
•Cash Flow
•Investment
•Risk Management
•Retirement
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Cash Flow
Investment
Risk
Management
Retirement

4. Cash Flow
Deductions
Savings
Expenses
• Gross Income vs Net Income
• Budgeting strategy – how to
categorize and track expenses
• Net Worth
• Lifestyle Inflation
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Cash Flow

5. Size of Pie Matters
Deductions
$700
Savings
$700
Expenses
$700
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Cash Flow
For better cash flow, always look for ways to increase the size of pie.
- Online gigs (teaching, voiceover, copywriting, photoshop etc.)
- Weekend jobs
Deductions
$800
Savings
$900
Expenses
$700
$2100 $2400
There is often a maximum limit
to which you can squeeze your
budget.

6. Deductions: Gross vs Net Income
Headers Amount per paycheck
Gross Pay $2500
Federal Tax ($355.92)
FICA ($155.00)
Medicare ($36.25)
State Taxes ($124.87)
Other Local Taxes ($7.95)
Net Pay $1820
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https://www.adp.com/resources/tools/calculators/salary-paycheck-calculator.aspx
ADP’s paycheck calculator is a great tool for estimating your net pay
Cash Flow

7. Deductions: Gross vs Net Income
Headers Amount per paycheck
Gross Pay $2500
Federal Tax ($355.92)
FICA ($155.00)
Medicare ($36.25)
State Taxes ($124.87)
Other Local Taxes ($7.95)
Net Pay $1820
www.finpins.com
https://www.adp.com/resources/tools/calculators/salary-paycheck-calculator.aspx
ADP’s paycheck calculator is a great tool for estimating your net pay
Cash Flow
In this world nothing can
be said to be certain,
except death and TAXES!

8. Deductions: Gross vs Net Income
Headers Amount per paycheck
Gross Pay $2500
Federal Tax ($355.92)
FICA ($155.00)
Medicare ($36.25)
State Taxes ($124.87)
Other Local Taxes ($7.95)
Net Pay $1820
www.finpins.com
https://www.adp.com/resources/tools/calculators/salary-paycheck-calculator.aspx
ADP’s paycheck calculator is a great tool for estimating your net pay
Cash Flow
In this world nothing can
be said to be certain,
except death and TAXES!

9. Budgeting - expense categorization
strategy
•These are non-negotiable needs - housing, food, transportation, healthcare.
Must Have
•These are important and add value to your life, but not as critical as above.
Should Have
•These are nice to have, but don’t add significant value to your life and are not as critical as above two
categories.
Could Have
•These are not really a priority in your life, and you can live without them without much inconvenience.
Won't Have
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Cash Flow

10. MoSCoW
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11. UST
OULD
HOULD
M
C
S
WON’T
70%
10%
20%
0%
Sample MoSCoW allocation Cash Flow

12. Expenses
• Let’s calculate the monthly
expenses on various items
such as housing, food,
fitness, and entertainment.
• If there are some costs
incurred on annual basis,
let’s approximate it to the
dollar per month value for
this exercise.
• After itemizing the
expenses, we will tag each
line item with M, S, C, or W.
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Cash Flow

13. MoSCoW Analysis
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Cash Flow
Item MoSCoW Amount
Rent M 750
Car S 125
Student Loan M 525
Grocery M 200
Café C 50
Restaurants S 100
Gas M 80
Phone + Internet M 50
Cable TV C 60
Streaming W 25
Gym S 30
Clothes M 35
Renter Insurance M 20
Car Insurance M 70
Beer S 35
Pets M 50
Credit Card Debt C 75
2280

14. MoSCoW Analysis
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Cash Flow
Item MoSCoW Amount
Rent M 750
Car S 125
Student Loan M 525
Grocery M 200
Café C 50
Restaurants S 100
Gas M 80
Phone + Internet M 50
Cable TV C 60
Streaming W 25
Gym S 30
Clothes M 35
Renter Insurance M 20
Car Insurance M 70
Beer S 35
Pets M 50
Credit Card Debt C 75
2280
MoSCoW Amount
M 1780 78%
S 290 8%
C 185 13%
W 25 1%
Grand Total 2280

15. MoSCoW Sheet
DEMO
www.finpins.com Get your personal MoSCoW budget worksheet at
https://finlightened.com/cash-flow/

16. Budgeting Skill Levels
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40%
30%
20%
10%
ROOKIE
M S C W
Cash Flow

17. Budgeting Skill Levels
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40%
30%
20%
10%
ROOKIE
M S C W
60%
20%
15%
5%
LIEUTENANT
M S C W
Cash Flow

18. Budgeting Skill Levels
85%
10%
5% 0%
GLADIATOR
M S C W
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40%
30%
20%
10%
ROOKIE
M S C W
60%
20%
15%
5%
LIEUTENANT
M S C W
Cash Flow
Get your personal MoSCoW budget worksheet at
https://finlightened.com/cash-flow/

19. Case Study
Jack vs Jane
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20. Jack
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Gross Salary
Net Salary
Bank Account
Expenses
Impulse purchases Savings + Investment
Taxes,
deductions
$5000
-$1400 $3600
$3600
-$2500
-$500 $600

21. www.finpins.com
Gross Salary
Net Salary
Bank Account
Expenses
Impulse purchases
Taxes,
deductions
Savings + Investment
2nd Bank
Account
S C
M
Expenses
$5000
-$1400
-$2000
-$500
$3600
$2000
$1600
$800
$800
$300
-$200
$100
Jane

22. Jack
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Gross Salary
Net Salary
Bank Account
Expenses
Impulse purchases Savings + Investment
Taxes,
deductions
Gross Salary
Net Salary
Bank Account
Expenses
Impulse purchases
Taxes,
deductions
Savings + Investment
2nd Bank
Account
S C
M
Expenses
$5000 $5000
-$1400 $3600
$3600
-$2500
-$500 $600
-$1400
-$2000
-$500
$3600
$2000
$1600
$800
$800
$300
-$200
$100
Jane

23. Key Takeaways
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24. 1. Be a MoSCoW
gladiator –
evaluate and
review often.
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25. 2. Autopilot your
‘Must-Have’
non-negotiable
expenses
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26. 3. Pay yourself first!
Save before Spending
on anything non-
essential
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27. 3. Pay yourself first!
Save before Spending
on anything non-
essential
2. Autopilot your
‘Must-Have’
non-negotiable
expenses
1. Be a MoSCoW
gladiator – evaluate
and review often.

28. Net Worth = Assets – Liabilities
Savings (from cash flow) can help both – create assets and reduce liabilities.
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Assets
House
401(k)
Savings
Cash
Car (depreciating asset)
Liabilities
Mortgage (remaining amount)
Car Loan (remaining amount)
Student Loan
Credit card debt

29. www.finpins.com
Most people increase their net-worth
by staying invested in great assets.
Jeff Bezos holds about 54 Million
Amazon shares
1 Amazon share = $3,338 (Oct 15,
2020)
$180B in just AMZN
stock
Source forbes.com

30. Lifestyle
Inflation
Increased spending due to self made choices
• Indulge in more expensive products and services
• Happens mostly when the income goes up (e.g. you get
a raise)
• Often the expenses go up at a higher rate than the
disposable income.
• Savings (and potential to pay off debt faster) get
squeezed down
• Generally irreversible: difficult to roll back to lower
expense lifestyle once you get used to ‘new’ lifestyle
How to avoid?
• Be disciplined with the expenses
• Evaluate and Review often
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31. Thank you www.finpins.com contact@finpins.com
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