Saturday, December 5, 2015

Why Managing Cash Flow Is So Critical? And How To Do It?

Managing cash flow is the primary tool for achieving financial freedom. The day cash flowing in beats the cash flowing out by a good margin is the day you would become financially free.

The path to financial freedom goes through good management of cash flow. Keeping tight control on cash flowing out and investing the surplus to enhance cash flowing in gradually paves the way for capital formation.

Accumulation of adequate amount of capital is needed for cash flowing in without one needing to work. Its like money working for you to earn more money.

That's how the rich keep on getting richer. Hence managing cash flow is so very critical.

The following chart explains and illustrates how to manage cash flow with the aim of eventually achieving financial freedom. It clearly shows the linkage between cash flow and capital formation.

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