The concept is simple, if the final balance of your financial life is negative then your cash outflows are higher than your cash inflows. This simple observation reveals that you will need to reset the cash inflows so that at least the final balance is zero.
To achieve balance and financial abundance your outflows of money (expenses and charges) will have to be lower than your income (income).
This simple replenishment is usually achieved through delays, Nicholas Nickleby and elimination of cash outflows and, worst case scenario, through the accumulation of debts which simply represent more liabilities, expenses and charges.
Having this concept present, your financial life does not have to be complicated. In fact it should be based on simple rules that you should implement and internalize today in your financial life.
Maximize Cash Entries
If we understand and consider that wealth equals then we simply accept that the essential equation in wealth creation for your life is:
Maximizing your cash inflows will certainly increase your chances of owning a balanced and sustainable financial life as well as promoting your wealth.
Keeping in mind this reality, your money inflows take up 50% of the weight of your financial life and these are maximized through your career and the way you manage it. In fact and even risk saying that the money inflows represent 100% of your financial life, since without these, there is no liquidity to promote expenses and charges.
Do not Forget to Diversify Cash Entries
On the other hand, diversifying cash inflows is also a potential solution to boosting your financial stability. In addition, it will further reduce the risk of dependency on a single source of income.
Therefore, investing in your career is fundamental, since it contributes 50% (100%) of your financial life and this is a continuous construction. Invest in your education and education. In your ability to undertake, risk and overcome different and diverse challenges.
Reduce Cash Outflows
The other part of the equation refers to your outflows of money, expenses and charges. This part of the equation is where your attention should be present simply because the outflows of money are directly correlated with your consumption habits and your needs.
Here the first task you must do is to discover the true constitution of your outflows of money. How are they organized? Where and in what amount? In what categories?
Knowing the constitution of your cash outflows, your behaviors and habits become more visible, you can now conduct a more informed analysis and identify items to save money.
Remember the purpose is for such outlets to make sense in your life. Be essential and satisfy something important in your life. Anything that does not make sense should be deleted, reset or replaced.
Automate Your Savings
Here’s a little bonus. As soon as you can determine your savings or manifestation of wealth, start thinking about automating such a differential.
By automating, your savings becomes a priority in your life, making sense that fulfills you just as well as fulfilling all your outflows of money. It’s an automated pay per view. Where to put your money? The best term deposits are not interesting … so if you do not want to risk, we can give you the savings certificates.