1 Cash flow
Cash flow is a concept in modern finance, which refers to the amount of cash and cash equivalents in a certain period of time. To borrow this concept here, it refers to the cash income of a retiree over a period of time (a month or a year).
Cash flow is important. Nobel Prize economist Robert Morton said: "The standard of living in retirement is not determined by the total amount of wealth, but by the income and cash flow. ”
Why? Some people use the analogy that life after retirement is like walking through the desert. Net worth is the total amount of water, and cash flow is the amount of water at the reserve points along the way. Even if there is a lot of water, we don't know how long the desert is or if there will be accidents along the way, so when crossing the desert, we must not only make sure that there is enough water, but also make sure that we have enough water at each supply point. Illustration: Desert Travel.
That's what cash flow is all about.
2 Cash flow management
According to **, cash flow can be divided into general income and **income. They are not the same, the functions are different, so the management focus and methods are also different.
The general income is mainly pensions. Pensions can also be divided into social pensions and commercial pensions. Social pension is like the reserve of the supply point, which is the basic guarantee of the old-age pension. Commercial pension is a supplement to social pension with the aim of improving the quality of pension.
Don't put all your hopes on social pensions. Social pension, in essence, is that retirees use their savings during their working period to pay for living expenses after retirement. At the same time, it can also be understood as supporting the non-working-age population for the working-age population. Retirees are an important part of the non-working-age population. So, it's subject to objective conditioning.
*The income is mainly various financial income, including house rental, etc.
Cash flow management focuses on ensuring steady growth in cash flow. This is necessary to combat hyperinflation. Venezuela is currently reporting high annual inflation, with prices doubling every four weeks. Inflation has turned flour and vegetables into high-end luxury goods, most of which have to be purchased on the black market. Some poor residents rely on picking up garbage to fill their stomachs. Millionaires became paupers in an instant. (Yang Xuexian).