How to increase your cash flow – The Phases of Financial Life

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Investors know that the first requirement to investing in Philippine stock market is cash flow.

Have you ever heard yourself saying “If I only had some cash now, I’d surely take this buying opportunity!”

If your answer is a resounding echoing yes, then it probably only means two things – you do not use this first tip & trick in investing or you’re really lacking in your cash flow.

To solve the latter, it’s important to assess at which phase of financial life you’re in now and take the appropriate course of actions. If you remember, in the last blog I shared some life investments you can take that will give you the best returns. This time, we’ll take a look at the phases of life under a financial magnifying glass.

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Phases of Life

There are two phases of one’s life familiar to many.
Phase 1 is when people is working for you.
Phase 2 is when you are working for money.

When you were a baby, I assume that you didn’t do anything to provide for yourself. Your parents, or whoever took care of you that time, did all the work to provide your basic needs. In fact, not just needs but protection and love as well. So it’s like all your needs were well taken care of without you being aware of it and without you doing anything to earn it. That was so easy, and I miss it. HAHA. Well, not really, since my mother still serves me my cup of coffee whenever I request for it, even if I’m already 23 years old. She keeps on reminding me to eat my meals and take care of my health when I seem to be unstoppable at work. Acts of love I’m sure.

The second phase is when you start to work for money. This begins when you sign your first job contract and formally enter the labor force of the Philippine republic. It’s an ecstatic moment for many. You say, finally, you can now have that “control” of your life.

Personally, the time I received my first pay became the richest point in my life. HAHA. I never thought that I would feel that way that day. I was caught shocked when I checked my account balance in an ATM during the first cutoff. Deep inside I was asking, “Is that balance amount I saw real?” HAHA.

Now that’s what you call active income.  Active income is a kind of income you earn out of your active work. A more general definition is that an active income is what you get when you exchange your time for money. And since each of us has limited time, that automatically translates to limited active income.

Simply stated, without your work, you’ll receive nothing. Zero active income.

Now after just few months of working, I began to be questioning, “If I have a monthly payroll schedule, that means I only earn a dozen times in one whole year.” JUST TWELVE TIMES IN 365 DAYS. And it somehow pinched a part of my pride. I felt it was too few. HAHA.

Going back, of course there can be instances when these two phases can coincide at the same time. Like during my college, wanting to make my last undergraduate year more productive, I applied as a student assistant in ES (Engineering Science) department giving me the opportunity to work for money while receiving my regular baon.  In effect I have active income at play with passive allowance. What I like most about it however is the fact that I was able to meet a lot of students who were under the classes I assist in. I guess teaching is really my destiny. HAHA

But back to the point, for the majority of people, they’re content with these two phases of life. Worse, their view is narrowed down to these two. They keep on relying on an active income only. If they stop working, they stop the flow of their income. They stop serving food on the table. Or sending their kids to school. Or sending OFW padala to Philippines.

Are you like that?

If yes, be afraid then. When you do it, you’re like flying in a plane with only one wing. One wrong mistake and you’re doomed to a financial disaster. And the sad part of it is that it’s not only you, but all your dependents that will be affected.

The two more phases of the wealthy

Wiser people choose to add more phases to their lives and have a good flight in their financial journey.

They add two more.

Phase 3 is when money starts to work for you. 
This is primarily made by investments including that in stock market giving you an easy access to enter this gateway of your life. By buying stocks, you become part-owner of giant companies and thus participate in its growth. You are able to own big businesses without the hassle, risk and complications of building it from scratch. You’re leveraging on the expertise of giant businessmen to make your money work for you. Your assets begin to generate more assets. Any paper asset that does this is better than an asset resting in peace in some other place

Finally phase 4 is when a system works for you.
You build a system that will replicate what you would otherwise personally do. This could be in the form of a business or technology.

In a business, people starts again to work for you, but this time, people no longer treat you as a baby but as a boss. By setting up a business that hires employees, you’re able to earn as a result of your brilliance in putting up a business and letting other people do the hard work for you.

Or let’s say that you’ve put up Online Marketing, for example, that will make the selling job automatic versus hiring sales agent. Now it’s no longer people working for you but technology designed to do the job. All you need to do is to invest that initial time to put it up at the start and it keeps on working for you 24 hours a day thereafter. Cool right?


That’s it!

That’s only a rough version on how you can possibly increase your cash flow.

The goal then is to create multiple streams of income. You should have not only a diversified investment portfolio but also diversified sources of income. When you do this, you position yourself to better improve your financial life.

Hope this lights up a bulb in you. Have a great week!

Have fun investing (by increasing your cashflow)!

Omeng Tawid 🙂


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Nice blog a big help symbolize a door for me to keep going to add more income in a doorway toward investing in stock market your tips in tricks are very useful guide to me as beginners.Thank you in i keep coming to read your blogs i love them and did my best to spread the good news to my family member in friends.May you live long and more people reach thier goal tru your teaching

  • Alma Pangresban

    Nice blog a big help symbolize a door for me to keep going to add more income in a doorway toward investing in stock market your tips in tricks are very useful guide to me as beginners.Thank you in i keep coming to read your blogs i love them and did my best to spread the good news to my family member in friends.May you live long and more people reach thier goal tru your teaching

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