4 Strategies to Build a Positive Cashflow – 360 Financial Strategists

As the old adage goes, “Cash is king!” However, while this rings true, the true power lies in positive cashflow management. Managing your finances serves as the foundation for wealth creation and financial stability.

But what exactly is cashflow management? It entails tracking and monitoring your finances and expenditures. This includes your general living expenses, utilities, rent/mortgage payments, and discretionary spending.

For many Australians, income primarily derives from employment. Unless one operates a business or earns bonuses or commissions, monthly income tends to remain relatively stable. However, spending and living expenses can fluctuate significantly, such as higher utility bills during colder months.

In our practice, effectively managing positive cashflow is paramount to our clients’ goal achievement. This entails four essential elements:

  1. Tracking and maintaining a budget
  2. Creating structure
  3. Prioritizing self-compensation
  4. Implementing consistency

Budget Wisely

Let’s be honest, ‘budgeting’ doesn’t exactly sound thrilling, especially if it’s your first time diving into it. Seeing all your Uber Eats splurges, numerous streaming subscriptions, and online shopping habits laid out on one page can be a bit intimidating – to say the least!

But here’s the thing: creating a budget is a crucial starting point for personal cashflow management. It’s about understanding where you stand financially and, more importantly, uncovering the pathways to where you want to be. Plus, think of your budget as a dynamic tool; it evolves with you and your spending habits, ensuring it stays relevant to your financial journey.

Create Structure

Get-now-pay-later. Tap and go. Click and collect. These systems aim to make spending your hard-earned cash effortless. But amidst these external temptations, you can establish your own internal system.

When diligently adhered to, it becomes a powerful tool to counteract the allure of these external methods.

Pay Yourself First

Paying yourself first means prioritizing savings before spending your income. It stands in contrast to the common practice of spending first and saving what remains.

While it sounds straightforward, many struggle to put it into action. This is where the importance of an accurate budget and a supportive structure comes into play. With a solid budget in place and the right structure to support it, paying yourself first becomes achievable.

Be Consistent

Now that you’ve crafted your budget and established the structure to pay yourself diligently, the key is to stay committed. Consistency is paramount; nothing undermines your efforts more than inconsistency.

Admittedly, maintaining consistency is a challenge. There’s always a new purchase beckoning, an event tempting you, or a trendy restaurant to impress your Tinder date.

Yet, if you’re honest about your priorities and stay true to them, this habit will be a gift your future self will appreciate. After all, what do you have to lose by investing in your financial well-being?

Let experts guide you through your journey to financial management! A financial advisor can offer insightful tips and strategies to help you make good financial decisions.

To find out if our strategies are right for you, feel free to contact 360 Financial Strategists online or on 03 9427 0855.