The cash flow for personal finance is nothing but circulates as money in your pocket or bank account, as well as exit and go out as income and meet their needs and what is the net result of all these operations over time.

During 2003 to 2005, holds a Masters of Finance at the IESA, one of the subjects that attracted me most was that of “Finance for Entrepreneurs” dictated by an excellent teacher and member of the center of entrepreneurs of that institution. In such matters were 4 key topics of which the most important in my opinion was: The cash flow.

I remember we often say, “Cash flow is the lifeblood of business.” He forgot to say that the cash flow of blood is not only business but also personal finance. A person with a faulty cash flow is a person who succumb to an army of creditors who do not leave you alone. A person with a faulty cash flow sooner or later will collapse economically.

The cash flow for both individuals and companies has three components:

Positive cash flow (CF +): which is the income received by the person, usually is given by the salaries, wages and other income generated by the employment of the company where you work (night bonus, overtime, utilities and other ). If the person is independent, then the positive cash flows are all income received by the person from their fees.

Negative cash flows (CF -): Which are the expenses of one person, ie, the costs should a person over a given period. They are an example of negative cash flows: market costs and food costs, electricity, gas, water, electricity and telephone costs of education for the same person, his spouse or children, transportation expenses, medical expenses, costs of debt and finally, all those expenses that a person has over a given period.