I have two stories to share with you today.
They say that a picture is worth a thousand words. Study the diagrams below and see if you can pick up some of the distinctions between the two stories. If you’re financially intelligent, you can see important distinctions in the diagrams.
The Power of Cash Flow
The first diagram depicts the actions of those who pay themselves first. Each month they allocate money to their asset column before they pay their monthly expenses.
The second diagram depicts the actions of those who pay everyone else before they pay themselves. Each month they allocate money to their expenses column and then invest with whatever is left over—which is usually nothing.