01/09/2021
In personal finance, cash flow is all about income and spending. If youโre spending more than you earn, youโll have a negative cash flow. How can you improve this? Earn more, spend less.
Again, sounds simple, but itโs not that easy to do. To help you out, here are a few ways you can improve your cash flow:
1. Make more money. The most straightforward way to have more money is, well, to make more money. So invest in your best asset โ yourself! Read books, widen your knowledge, improve your skills to expand the range of income streams you can have. Having more marketable skills will increase your earning power and positively influence your cash flow.
2. Invest in learning. This is a part of investing in yourself. The more you know, the more ways you can find to make money. Whether thatโs by improving yourself in your current company or learning ways you can start your own business or sidelines, learning is an investment that will never go to waste.
3. Be enterprising. Iโll admit that I donโt think entrepreneurship is for everyone. However, I still think that more Filipinos can go into entrepreneurship. But itโs important that you go into it armed with knowledge โ among others, you should read about the business you want to get into, observe the market, make sure your business plan is solid, and have an exit plan. It would also help to start small, such as basic buy and sell or commission selling. If you prepare correctly, and with Godโs grace, you could be one of them. A successful business or sideline will do wonders for your cash flow.
4. Spend less money. Making more money takes time and effort. It may take months for you to get that pay raise, or even longer for your business to start raking in profits. You know what takes less effort and has immediate effects? Spending less money! Iโve said it so many times that you might feel like Iโm a broken record, but itโs still true โ the way to wealth is spending less than what you earn and investing the difference. If you do this for the long term, youโre sure to meet your goals.
While it may take objectively less effort to spend less than to make more, it also feels a lot more painful. We Filipinos have a culture of spending. How many times have we promised ourselves that weโd be more diligent about spending, only to go out and make unnecessary purchases?
Credits to Randel Tiongson
