Definition

Planning how money will be spent and saved to keep the business running. A clear budget helps avoid overspending and surprises.

What to consider

  • Keep liquidity for day-to-day operations.
  • Plan for seasonal variations.
  • Review cash budgets regularly.

Real world scenarios

  • A retailer forecasts its daily cash inflows and outflows to ensure liquidity during busy seasons.
  • An entrepreneur sets aside cash reserves for upcoming expenses.
  • A small business in Houston maintains a cash budgeting system to track all transactions.

Related terms

Entrepreneurial Finances