Preparing a budget or 'Cash Flow Summary' (i.e. after-tax income, less expenses) will determine your net monthly savings capacity. This savings capacity is one of your greatest financial resources and will drive your ability to meet your various financial objectives such as paying down your mortgage and building your retirement savings.
Allocation of Savings
Once we have developed a Cash Flow Summary, we will know how to allocate your savings for the following purposes:
- Insurance – To meet your risk management objectives
- Retirement Savings – To meet retirement objectives
- General Savings – To meet short and medium-term savings objectives
- Debt Reduction – To meet debt management objectives
Cash Flow Management Strategies
We recommend keeping a minimum balance in your chequing account to meet your basic monthly expenses, and the balance of any short-term savings in a high-yield savings account.
Contributing to your retirement savings accounts on a monthly basis is just one of many strategies for easing cash flow management. An RGF advisor will suggest other strategies when creating your Cash Flow Summary.
For more information, please feel free to contact a Rogers Group Financial advisor.