What is Cash Flow? Cash flow simply refers to the amount of money coming into and out of your accounts each month. When more money flows out than in, your cash flow is negative. When more flows in that out, you have blissfully positive cash flow.
In reality, cash flow ebbs and “flows” (no pun intended, seriously) throughout life for most individuals. The most common way to have money flowing in is from a salary, but sometimes during periods between jobs or during transition times, salaries can be lacking. This is one of several reasons it makes sense to establish multiple streams of income to supplement your salary.
Additional income streams can come from investment capital if you have it. Right now, as you probably already know, income from traditional investments, such as bonds and preferred stocks, are at very low rates.
What are some other potential sources of income? Here are a few ideas:
- Rental property-Some are actually cash flowing again
- Consulting work in any area of expertise
- Outsourcing your skills on sites such as elance.com or guru.com
- Creating a new business-what skills do you have that are in demand?
- Selling stock options, either yourself, through a financial professional or fund
Remember that creating sustainable positive cash flow is the way to accumulate wealth beyond those one off windfalls that may come your way. Besides, if you are in a corporate job right now, and things go well in another area, you may even create the option of leaving the corporate world; not only this, but just knowing that you have the power to make it happen increases your financial security.