By creating positive cash flow and the right financial strategies, investors can grow their wealth. With more cash comes the opportunity to create more flow, so it’s important to understand that cash flow is simply the difference between the amount of money that comes in and goes out each month.
To become a cash flow king, investors should prioritize expenses and create a system to manage them. A good management method is to separate spending into three buckets and establish accounts for each: fixed expenses, discretionary expenses, and savings/investments. Once the amount that needs to be allocated to each bucket has been determined, automatic transfers from a main checking account should be set up. This will provide a spending limit for discretionary expenses that will make a budget plan easier to follow.
Work with your Enso | Sonoma financial advisor to make saving and living within your means a priority!