However, if you’re like most people and don’t have the time to read through a mountain of books, magazines and web-sites (or have the inclination to do so), then this article is for you. It will list out the main “rules of thumb” for financial planning.

The FCF can be used for several purposes, including paying a dividend, buying back stock, lowering debt, or saving for future acquisitions. Without FCF, a company will find it hard to grow its business without issuing new debt or diluting the stock. Except for start up corporations that will often show negative cash flow in their beginning years, free cash flow is a good indicator of a company’s ability to both maintain and increase its operations.

When using P&L to determine rent, there are three different ways to achieve this. Cash flow is one option, which uses the actual rent paid to create the rent costs. GAAP rent can be used to determine P&L, as well, if the property experiences decreases or increases. However, when using GAAP rent it is important to only do so if the changes are a fixed. The third way is referred to as Effective rent. It is calculated by taking the the base rent and averaging it with any free rent units or properties. The useful thing about using Effective rent is it is reflected on the P&L with increased add, so the bottom line can appear higher.

If you only have staff and not team, you’re working for your staff for free! Staffs are simply reactive people on your payroll that you need to continuously ensure that they do their work, especially when you’re not around. Team are those that work as though they’re working for their own company. You need to build winning teams or you’d end up with losing money.

Some planners suggest even more than five to eight times your annual income as the level of coverage you should carry. My suggestion is that you get your financial house in order, which means getting your net worth and cash flow examples together, and go talk to a good insurance agent about your needs.

Use online tools like financial planning tools to create a workable plan. Regulate the extent of student loan availed. Take on part-time work to help meet expenses and make small and steady investments.

This is the money you are owed. If accounts receivable are on the rise, you may be getting a warning that the folks you sell to are starting to stumble.

The best way to implement this rule is to make it automatic. Have 10% of your take-home pay pulled from your paycheck and deposited into a separate bank account. If your employer doesn’t allow you to do this, simply set up a transfer between your main account and your “ten percent” account equal to ten percent of your paycheck.