Cash Flows from Capital and Related Financing Activities. Cash flows from capital and related financing activities include acquiring and disposing of capital assets, borrowing money to acquire, construct or improve capital assets, repaying the principal and interest amounts and paying for capital assets obtained from vendors on credit.

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GrizzlyAlloy
Liberty Fan
Member since Aug 2020
472 posts

Cash flow situationPosted by GrizzlyAlloy on 6/15/21 at 8:07 pm
Sorry to the guys in the STLHF thread for going off topic, but the conversation got me thinking about my goals for the investment.
I know the prevailing thought here is to not pay off low interest debt with money that can out perform the interest rate. But, what if I need the cash flow for something else?
For instance, my infant is about to start daycare at $800/mo. If I can take the money I have currently saved for a new vehicle ($19,000) and the investment increased enough to pay for a new truck before the end of the year and elimintated a $550+ note, would that be wise?
I guess the prudent Money Talk answer would be to buy a $30k truck or less, but I have a 401k/IRA/HSA/529 and want to indulge. And my line of work has some perception considerations.

Mingo Was His NameO
LSU Fan
Brooklyn
Member since Mar 2016
18315 posts
Online

re: Cash flow situationPosted by Mingo Was His NameO on 6/15/21 at 8:09 pm to GrizzlyAlloy

What Are Real Cash Flows

quote:
If I can take the money I have currently saved for a new vehicle ($19,000) and the investment increased enough to pay for a new truck before the end of the year and elimintated a $550+ note, would that be wise?

Sure, now let's talk about if your 19k goes down 10%

Upperdecker
US Space Force Fan
St. George, LA
Member since Nov 2014
24903 posts

re: Cash flow situationPosted by Upperdecker on 6/15/21 at 8:15 pm to GrizzlyAlloy
A good rule of thumb is not to invest (gamble) money that you need for something. Sounds like you need that money for a new vehicle, and I imagine if you do lose some of that money that you will be in a bind. I wouldn’t “invest” it
quote:
And my line of work has some perception considerations.

What’s your line of work?

MrJimBeam
New Orleans Saints Fan
Member since Apr 2009
6194 posts
Online

re: Cash flow situationPosted by MrJimBeam on 6/15/21 at 8:23 pm to GrizzlyAlloy
Don’t gamble with grocery money.
Basically, you can’t commit money you aren’t willing to lose. If you’re willing to take this risk, go for it. It’s your money.

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GrizzlyAlloy
Liberty Fan
Member since Aug 2020
472 posts

re: Cash flow situationPosted by GrizzlyAlloy on 6/15/21 at 8:32 pm to Mingo Was His NameO
quote:
Sure, now let's talk about if your 19k goes down 10%

Touche. I do have an emergency fund. This going to zero won't kill us. The investment is +70% currently.

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GrizzlyAlloy
Liberty Fan
Member since Aug 2020
472 posts

re: Cash flow situationPosted by GrizzlyAlloy on 6/15/21 at 8:34 pm to Upperdecker
quote:
What’s your line of work?

Project manager for a construction company.

tigersfan1989
LSU Fan
Member since Oct 2018
932 posts

re: Cash flow situationPosted by tigersfan1989 on 6/15/21 at 8:38 pm to GrizzlyAlloy
For me cash flow fluctuates so I tend to save on higher earning months and invest it. If I need to make a large purchase I’ll sell some investments to make the purchase to normalize my monthly bills. If I wanted a new truck tomorrow I’m most likely selling investments for a majority of the purchase because I simply can’t cash flow a $800 truck note consistently. Some months I might save 2k but some months I might “break even” after putting towards retirement and kids college accounts. Now over time I might have accumulated extra savings and investments to put 30k into a purchase and might finance some to have a lower note. Might sound kind of odd to others but I don’t like having large monthly obligations I’d rather pay for it in a lump sum. Based on your post I’d maybe wait a little longer to save up more to buy the truck if you don’t feel like you can cash flow the note.


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slackster
Stanford Fan
Houston
Member since Mar 2009
73777 posts
Online

re: Cash flow situationPosted by slackster on 6/15/21 at 8:40 pm to GrizzlyAlloy
I’m not really sure I understand your question. Are you asking if you should pour your $19k into a single stock in hopes it would grow enough to pay for a truck?


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GrizzlyAlloy
Liberty Fan
Member since Aug 2020
472 posts

re: Cash flow situationPosted by GrizzlyAlloy on 6/15/21 at 9:00 pm to slackster
I took money I've been saving for a new truck and invested it in a single stock. It's currently at 32.7k. I stated in the thread that my goal was to buy a new truck with the money. I got the typical MT response of 'Trading an appreciating asset for a depreciating one... the American way!' and 'Ill be damned if I take out investments making 12% to pay cash for a truck..'


Upperdecker
US Space Force Fan
St. George, LA
Member since Nov 2014
24903 posts

re: Cash flow situationPosted by Upperdecker on 6/16/21 at 8:39 am to GrizzlyAlloy
quote:
Project manager for a construction company.

If you can’t afford a nice truck then don’t get one. Just bc all your workers are in debt doesn’t mean you need to be. You don’t need to drive a nice truck

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Mingo Was His NameO
LSU Fan
Brooklyn
Member since Mar 2016
18315 posts
Online

Forecast
re: Cash flow situationPosted by Mingo Was His NameO on 6/16/21 at 8:45 am to GrizzlyAlloy
quote:
I took money I've been saving for a new truck and invested it in a single stock. It's currently at 32.7k.

It sounds like you have money now for the truck, so I'm not sure what you're asking.
Take out of your investment what you need for a down payment for the truck to be comfortable with your cash flow after adding in a truck note and leave the rest invested.
The more you post the more confused I'm becoming

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thunderbird1100
LSU Fan
GSU Eagles fan
Member since Oct 2007
62252 posts

re: Cash flow situationPosted by thunderbird1100 on 6/16/21 at 9:33 am to GrizzlyAlloy
quote:
And my line of work has some perception considerations.

I dont know why people ever worry about this kind of stuff.
You're married with an infant and you're worried about what people at work think about what you're driving?
Just drive what you want to drive. It's one thing to get a vehicle to fit a work purpose - like a real estate agent having a roomy vehicle to take people around to look at houses, a construction worker who has a truck to haul tools around, etc...but seriously, worried about what people think you drive at the workplace? Why? Who cares
Also if you have an infant about to start daycare at $800/mo blowing all your non emergency extra cash on a new truck seems like a really bad idea. Do you even need a new vehicle or just want one?
Also do you have $19k or $32k, you mentioned 2 completely different amounts you have saved up so far.


GrizzlyAlloy
Liberty Fan
Member since Aug 2020
472 posts

re: Cash flow situationPosted by GrizzlyAlloy on 6/16/21 at 11:07 am to thunderbird1100
I don't carry tools around in my truck. I go to different sites that I manage and meet with clients.
The 19k investment is now over 32k.
From more thinking on this subject, I've got my financial bases covered. I'm going to take the money I gambled and buy a nice truck.
Adding daycare cost and subtracting truck note will be budget neutral. Screw the low interest debt vs. market gains debate.
Thanks for everyones input.


whatshisface
LSU Fan
Westside
Member since Jun 2012
189 posts

re: Cash flow situationPosted by whatshisface on 6/16/21 at 11:24 am to GrizzlyAlloy


GrizzlyAlloy
Liberty Fan
Member since Aug 2020
472 posts

re: Cash flow situationPosted by GrizzlyAlloy on 6/16/21 at 11:29 am to whatshisface

Difference Between Money Cash Flow And Real Cash Flow


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Real cash flow

Income expressed in current purchasing power terms.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Real Cash Flow

A company's cash flow for a certain period of time adjusted for inflation. For example, if a company wishes to compare its annual cash flows between 1995 and 2005, it may adjust all figures and reflect them in 2005 dollars. The real cash flow gives a company an idea of how it is really performing from one period of time to the next.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

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