It is important to complete both monthly and yearly financial reviews to have good cash flow management and financial planning for the future. Monthly financial reviews such as budget plans and income statements allow us to keep track of cashflows and outflows. Understanding each expense, allows us to make monthly adjustments to maintain budget variances. Which in turn allows us to budget and save more money. Saving more money helps increase our overall net worth. Monthly financial reviews help maintain budgets, meanwhile, yearly financial reviews can help further develop future financial plans.

To explain, comparing year-to-year nominal income against inflation rates helps us determine whether or not our income is keeping up with inflation rates and allowing us to gain a greater net worth or not. At the end of the year, you can see financial progress and know what type of actions you need to take to either increase savings, tighten budgets, or risk-taking greater investments. Monthly and yearly financial reviews are important for all of these reasons to make an efficient financial plan. However, doing financial reviews daily is most likely too often because it does not allow you to see progress or make financial forecasts. A daily voucher to record cash transactions is a good idea to document and review at weekly intervals. Yet, even then, it is easier to see progress after 2 weeks rather than 1 week. A voucher simply helps keep a better record of cash payments and receivings.

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