What is cash flow?

What is cash flow? 

Simply it's the flow of the cash, how your cash flow from one side to another side. In this case what goes in (earning) and what goes out (spending).

What is our aim is to have a positive cash flow (higher earning than the spending).A positive or negative cash flow will affect your net worth (your wealth). Follow the negative and you will become poorer.
 
Project your cash flow in paper. First list out all your income with the monthly and yearly coloumn
Item | monthly | yearly
Salary S$2.000 S$ 24.000
Dividend S$20 S$240

Then create your outcome.
Item| monthly | yearly
HDB rent S$700 S$ 8.400

And then total all by total income - total outcome monthly and yearly and hope that your cash flow is positive.

It need a discipline and will to really come out with a cash flow, it's not easy but it's rewarding.

Maybe your eyes will be open, there is some outcome you can reduce.

This is not only to prepare how much money we can invest but also this is the basic of finance.

With negative cash flow you can't do much, don't even talk about investing.

So make sure you have an positive cash flow as well as positive mind.

Are you positive or negative ?