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You Don’t Have a Money Problem. You Have a Cash Flow Problem.

by | Sep 26, 2022 | Money, Personal Finance

Money problems aren’t what they seem.

I help people acquire online skills through my business, so I talk to a lot of potential customers every year. I noticed a pattern.

People will often say some version of “I can’t afford your services” or “I have money problems.”

It’s a lie.

Understand cash flow to change your financial future

The problem isn’t that we can’t afford a purchase.

And the worst thing we shouldn’t reject are investments in our future selves, such as learning new online skills.

If you only see the inability to invest cash as a money problem, then your likely course of action is to reduce expenses or say no to good opportunities. That’s a sad reality that makes money problems worse.

If there isn’t enough free cash to invest in yourself or in financial assets, the problem is cash flow.

Cash flow is a fancy term for money that goes in and out of your bank account. A lack of cash flow means you need to find a way to get more money to flow into your bank account.

Just saving or reducing expenses doesn’t fix the underlying cause.

If there isn’t enough money to invest, the question you should be asking yourself is either:

  1. How do I add an extra income source?
  2. Or how do I increase my cash flow?

The bizarre reason your cash flow problem won’t go away

So if cash flow is simple then why don’t people fix the issue?

Well, people don’t want to look weak or ask for help. So they stay on the treadmill and remain part of the rat race rather than do the hard task of taking actions that increase cash flow.

When we’re afraid to take risks and worry too much about what others think, we stand still rather than move forward.

The uncommon solutions to cash flow problems

Let’s go through a few ways to fix personal cash flow.

Once your cash flow becomes unstuck, surprisingly, so do you. Everything starts to change from that moment on.

Change your mindset

Psychology determines cash flow. Read that again.

If you think like a loser you’ll act like a loser. That’s the harsh truth. I often say this to friends and family:

No optimism, no new opportunities.

First you have to believe that an increase in cash flow is possible for you. You have to believe you can AND will find ways to make more money, rather than stay stuck trying to reduce expenses in an economy that has record inflation and (likely) higher price rises built in for several years.

That also means you can’t get stuck in a downward spiral of recession-thinking. The type of thinking that leads silly people to believe “the end of America” headlines.

While everyone is paranoid about, frankly, nothing — you’ve got to believe recessions are temporary and that now is the time to work on cash flow problems, not give up and watch Netflix.

Birthrights, privilege, luck, debt, and postcode have nothing to do with it. They’re just excuses.

The money game is won or lost in the mind.

Increase your value

We get paid what we’re worth.

That’s a bitter truth for many to swallow. It’s reality though. If you go to work or jump on social media and do nothing but come up with problems, the value you have plummets.

Value is created by coming up with solutions to problems.

If you want to raise your value, therefore increasing your cash flow, you have to start to solve problems.

  • The easiest problems to solve are the ones your boss faces.
  • The second easiest problems to solve are the ones the customers at your job face.
  • The hardest problems to solve are the ones strangers face.

To solve a stranger’s problem, where you get paid the most, you first have to be on their radar. The way to do that is by building a community, email list, or publishing content on social media.

All these online skills can be taught. But if you don’t invest in self-education there’s no easy way to figure it out. Everything just looks hard so you become skeptical and run from the very vaccine that can save your life.

Start a type of business no one talks about

Not the type of business that requires you to be an entrepreneur.

That’s too damn fancy for most of us. I’m talking about a one-person project you monetize or a side hustle. I’m talking about a type of business you do on the side while you work a 9–5.

All the effort spent trying to get a promotion or a pay rise is better invested in a side business where you have full control and ownership. At the start this will mean nothing.

Halfway through the journey, ownership in a side business will produce many aha moments — a new understanding of tax, leading others, alternate online income streams, networking skills, etc.

Realize you’re probably uneducated

Many of us have worthless educations we paid lots of money for.

I studied sound engineering but it did nothing to help me earn money or fix my early cash flow problems. Many of you also have college degrees that are worthless and won’t fix yours.

Accepting the value of that education may have been a waste is hard.

When you do, though, it sets your mind free to re-educate yourself for an economy that doesn’t give a crap about college degrees or traditional (static) skills from centuries ago.

Bringing it all together

Quit telling yourself you can’t afford stuff, or you have money problems, or “it’s hard for us.”

Life is hard for everyone. Lean into hard. Do hard things to increase your value. When your value increases so does your cash flow.

Focus on increasing cash flow instead of decreasing spending and acting as if money problems are a random tornado event.

The question that drives powerful financial futures is, how do I make more money and increase cash flow?

Everything else is a dog and pony show.

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