Wealth is Good
Cash Flow Is Better

A runner-up choice for our tagline was “Financial Independence, One Goal at a Time.”  That’s actually a description of just one part – the last part – of the Cashflownavigator system: using the Navigator Tracking Tool.

Setting a goal, and using the Navigator Tracking Tool to achieve it, completes a Cashflownavigator cycle.  The cycle begins with filling in your 8020 Worksheet™, which captures your assets and liabilities (wealth) and all your monthly cash flows.

Having measured your wealth and cash flow in the 8020 Worksheet™, your next step is to apply the principles from our free e-booklet, Wealth is Good, Cash Flow is Better©, to help you identify your next financial goal.  In general, that goal involves saving to either pay off a liability (a vehicle, credit card debt, a student loan, etc.) or to acquire a “Best” asset type (an asset that either appreciates in value or generates positive cash flow, or does both).

Once you’ve decided on your goal, the last step is to use the Goaltracker tool to establish a disciplined process for saving up and achieving it.  This requires a specific dollar amount to save, and a defined time period – a deadline – by which you are to complete the task.

To set a goal in the Navigator Tracking Tool just choose the liability from the drop-down menu you want to pay off, or the asset you want to acquire.  Then enter the total amount you’ll need to save to accomplish the goal.  For example, in the illustration above the goal is to save a total of $3,000 to pay off a vehicle loan or lease.

All that’s left now is to decide how much per month to save to pay off this $3,000 debt.  We get you started with a recommended amount, $500 per month in this example.  That’s the amount you should be able to save each month based on cash flow values in your 8020 Worksheet™.   But you can change this by typing in a new amount.

With both the total and monthly savings amounts defined, the Navigator Tracking Tool calculates how many months it should take you to accomplish the goal (6 months), and it creates a calendar to help you manage the process.  At the end of each month, simply fill in the actual amount you’ve saved, and the Navigator Tracking Tool will add up the Total Actual Amount you’ve saved so far, and how much ahead or behind schedule you are.

And that’s it…that completes the cycle.  Once you’ve accomplished this goal, you’re ready to reassess your 8020 Worksheet™ and choose your next goal.  Use the Navigator Tracking Tool to achieve that one, and with each one you will move another step closer to financial independence.

Keith Whelan is Cashflownavigator's founder and author of the "Wealth is Good, Cash Flow is Better" e-booklet. He is a graduate of Columbia University Business School, teaches at Rutgers University, and has over 30 years experience in the banking and financial services industry. Keith, his wife Cindy, and their two sons live in New Jersey.