The 13-week cash flow forecast
By Steve Kopshaw · Published
A 13-week cash flow forecast is a week-by-week list of the cash you expect to come in and go out over the next quarter. It shows you the exact week money gets tight, while there's still time to do something about it.
Monthly reports can't do that. A month can look fine on paper and still have a week in the middle where payroll and rent hit before the client checks clear.
Why 13 weeks
Thirteen weeks is one quarter. It's long enough to catch the quarterly tax payment, the annual insurance bill and the slow season, and short enough that you can actually predict it.
And it's weekly because bills are weekly. Payroll runs on a schedule. Rent is due on the first. Clients pay when they pay.
How to build one
You need five rows, one column per week.
- Starting cash. What's in the bank at the start of the week. Week 1 is today's balance; every week after starts with the week before's ending cash.
- Cash in. What you'll actually collect that week. Not what you'll invoice. If a client usually pays 30 days late, put the cash in the week it really shows up.
- Cash out. Every payment on the date it leaves: payroll, rent, loan payments, card bills, software, contractors, quarterly taxes, the annual bills you forget about.
- Ending cash. Starting cash plus cash in, minus cash out.
- Your floor. The lowest balance you're willing to see. Any week that dips below it gets flagged.
That's it. A spreadsheet does the job.
A worked example
Say you start with $40,000 in the bank, run payroll of $18,000 every other week, pay $6,000 in rent at the start of each month and keep a $20,000 floor. (Made-up numbers.) Here are the first six weeks:
| Week | Start | Cash in | Cash out | End |
|---|---|---|---|---|
| 1 | $40,000 | $22,000 | $27,000 (rent, payroll, other) | $35,000 |
| 2 | $35,000 | $12,000 | $7,000 (other, insurance) | $40,000 |
| 3 | $40,000 | $15,000 | $21,000 (payroll, other) | $34,000 |
| 4 | $34,000 | $8,000 | $5,500 (other, loan) | $36,500 |
| 5 | $36,500 | $20,000 | $27,000 (rent, payroll, other) | $29,500 |
| 6 | $29,500 | $9,000 | $18,000 (estimated tax, other) | $20,500 |
Across the six weeks, $86,000 comes in and $105,500 goes out. If one client in week 6 pays two weeks late, you're below your floor.
Week 6 is the week that matters: $20,500, right on the floor.
Your monthly P&L would never show that. It shows the month. The forecast shows the Tuesday.
What to do when you see a tight week
You found it six weeks out, so you have options:
- Chase the invoices due before that week.
- Move a payment that isn't tied to a date: a purchase, a software upgrade, a hire start date.
- Ask a client to prepay or move a milestone payment earlier.
- Line up a credit line now, while you don't need it.
Getting money faster right now is more important than the total amount of money. The forecast is how you know when "right now" is.
Keep it alive
Once a week, 20 minutes. Replace last week's forecast with what actually happened, add a new week 13 on the end, and look at the low point. Over a few months you'll learn how far your guesses miss, and the forecast gets sharper.
The template
A downloadable template is on the way. Until then, the five rows above in any spreadsheet do the job: one column per week, starting cash at the top, and a cell that turns red when ending cash drops below your floor.
Run your own numbers
The forecast tells you when cash is tight. The free Capital Allocation Calculator helps with why: it shows whether gross profit is being split in a way that leaves the business any cushion at all.
Your move this week
Before you open a spreadsheet, list every payment that leaves your account in the next 13 weeks, with its date. Payroll, rent, loans, taxes, annual bills.
Most owners find at least one they'd forgotten. That's the week you were going to be surprised.
FAQ
What is a 13-week cash flow forecast? A week-by-week projection of cash coming in and going out over the next 13 weeks, used to spot cash shortfalls before they happen.
How do I make a cash flow forecast? Start with today's bank balance, list expected collections and payments by the week they'll actually happen, and carry each week's ending cash into the next week.
What's the difference between a cash flow forecast and a budget? A budget plans income and spending for the year. A cash flow forecast tracks when money actually moves, week by week.
How often should I update it? Weekly. Replace the past week with actuals and add a new week at the end.
Do I need accounting software for this? No. A spreadsheet with five rows and 13 columns works. Software helps once you have more accounts and more bills.
Keep reading
Cash flow vs profit: why a profitable business runs out of cash
Profit is what you earned. Cash is what you have. The six places profit hides from your bank account, with a worked example and how to fix each one.
Gross profit vs net profit: which number tells you the business works
Gross profit tells you if the work makes money. Net profit tells you if the business does. How to read both, with a worked example.
Underpricing: the signs you charge too little
Busy, booked and still broke is usually a price problem. Five signs you're underpriced, and how many clients you can lose and still come out ahead.
The AI employee: what it can and can't do in a small business
An AI employee is a model plus a job, tools, a rhythm and guardrails. Which jobs to hand it first, and the math on whether it pays for itself.
How much does a business coach cost?
What business coaching costs by format, what industry data says, and a simple test for whether a coach will pay for themselves before you sign.