What a cash-flow forecast shows
A simple forecast starts with the balance you have before month one. For each month, add the income you expect and subtract planned bills, other spending, and money you intend to set aside for savings. The result is an estimated month-end balance.
This is useful for asking whether your current plan looks comfortable or tight. It is an estimate based on your assumptions, not a promise about your bank balance on any particular day.
Gather four numbers
- Opening balance: the amount available before the first month. It can be below zero.
- Monthly income: the total you expect to receive each month.
- Monthly bills and spending: the total you expect to pay out each month.
- Monthly savings allocation: money you plan to set aside. In this method it reduces the available balance, so do not count the same transfer again under spending.
Choose a horizon from one to twelve months. The free calculator applies the same monthly totals to every month in that horizon.
Calculate a month, then carry it forward
Monthly change = income − bills and spending − savings allocation
Month-end balance = opening balance + monthly change
For the next month, use the previous month-end balance as the new opening balance.
Suppose you start with €1,800, expect €2,400 in monthly income, plan €1,750 for bills and spending, and set aside €300 for savings. The monthly change is €2,400 − €1,750 − €300 = +€350. Keep those totals unchanged for this three-month illustration.
| Month | Starting balance | Estimated month-end |
|---|---|---|
| 1 | €1,800.00 | €2,150.00 |
| 2 | €2,150.00 | €2,500.00 |
| 3 | €2,500.00 | €2,850.00 |
You can reproduce each row by adding €350 to the starting balance. After month three, this simplified plan estimates €2,850.00.
Check what the estimate misses
The free calculator uses monthly totals. It does not place payments on specific dates or model one-off expenses, interest, or tax. For example, a separate €600 insurance bill in month two would reduce the example’s month-two ending balance from €2,500 to €1,900. If nothing else changes, month three would then end at €2,250 rather than €2,850.
Timing also matters: rent paid before your salary arrives may leave you short during the month even when the projected month-end balance is positive. Check your actual payment dates separately before making a time-sensitive decision.
Put the method to work
Try the estimate with your own monthly totals. Change one assumption at a time — such as spending or savings — and compare the month-end results. If a month ends below zero, revisit the plan and check the real payment dates before relying on it.
Want to continue planning in Spendly Budget? Create a free account and enter your plan there separately. Calculator inputs are not transferred to an account.
For a longer worked example, compare two six-month scenarios.