This Article is About
cash flow
positive cash flow
linear income
breathing room
emergency funds
money cash
residual income
business owners
real world
Cash Flow Is King
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In the real world cash flow has a lot to do with business and how well their cash flowed in or out of the business. I’m writing to the institution of the family and not the business or organization to alert you that in the world of money, cash flow is king. If you have no cash flow; you’re not going to make it; in fact this is exactly where all the problems begin. The reason is because in the capitalistic world we live in the cost of living is always present. Bills come in every month or day and you need a certain amount of cash flow to cover your head. I hope to show you how a good cash flow will give breathing room, how residual cash flow is better than linear cash flow, and better ways to create more cash flow.

When you have a positive cash flow it gives you breathing room. The best example I can create is very simple; you have a job that pays you a net income of $5400 each month and you have total bills and expenses that total $4500 each month. Your cash flow each month then is only $900 bucks; which is dangerous if your expenses did not include insurances, investments, and emergency funds. Nevertheless, the $900 of cash flow does give you breathing room to go to the movies with; to go out on the town, take a small trip, or what ever crosses your mind. This is what you are looking for in your life, to have a cash flow after your expenses.

Cash flow is based on two types of income; there is linear and residual and unless you’ve lived under a rock for the last few decades you’ve heard of both. Linear is the more popular and common; it is based on trading time or hours for dollars. Hourly work is based on linear income and so are salaried workers too. Residual income is income that is constant; it is doing a task once and getting paid over and over for it as long as it is used. Artists, authors, musicians, business owners, and product owners are key residual earners. They can perform a task once, such as write a book, and be paid on it every time it sells or is distributed.

The reason this works better than linear income is because no additional work needs to be done the next month or year beside basic marketing and your income can get bigger or remain the same if you physically work or not that month.

Best ways to create more cash flow is to create your own product, start a business, or invest by making money work for you. Owning your own product allows you to go from place to place and sell or distribute it. Owning your own business or business system allows you to earn money, thus cash flow, by leveraging yourself off the system. Owning key investments allows you to leverage yourself off your money. These will allow you more cash flow if you limit your expenses and prepare them wisely. In the Bible it says a wise man is wise because he has discretion in his decisions. Use prudence so that your cash flow is positive and always there for you.

Cash flow is King in the land of money and expenses…

Koko Ishe

Street Talk

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