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If you have deposited a paycheck or paid a bill, then you have encountered the concept of cash flow.  Cash flow simply means the flow of cash through a business or household.  In business terms, cash flow involves the flow of cash into a company in the form of revenues and then out of the company in the form of expenses.

For an individual or household, cash flow simply means getting income in the front door in time to pay expenses out the back door.  Every household manages cash flow on a daily basis.  You receive income from your employer or some other source, and then you use that income to pay bills or buy things you want and need.

This brings me to the cash flow industry.  This industry is a marketplace where businesses and individuals get help managing their cash flow needs.  The cash flow industry is all about getting cash into people’s hands when they need or want it.  One primary way the industry solves cash flow needs is buying income streams that are owed in the future.

What’s an income stream?  I’m glad you asked.  An income stream is simply how cash flow professionals refer to a future payment or series of payments.  Essentially, an income stream is a financial obligation or dept that one party owes to another party.  The financial obligation is generally reduced to writing in a legal document, for example invoices and contracts.  Most income streams which are bought in the cash flow industry are privately held. This means that the income stream is owed to a private individual or business rather than to a bank or other financial institution. 

Sample #1:  Let’s suppose you sold your home to your daughter and provided the financing yourself.  Now your daughter writes a monthly check for her mortgage payment directly to you rather than to a bank.  In this case, your daughter’s payments create an income stream for you.  That income stream is privately held, because you are a private individual, not a bank or mortgage company. 

Suppose now that instead of receiving monthly mortgage payments from your daughter, you would rather have a lump sum of cash in order to buy another home.  Could you get cash in exchange for your daughter’s future payments at your local bank?  Probably not.  However, you could get cash for this income stream in exchange for the right to collect those payments over time.

Sample #2: Let’s look at another example. Suppose you own a marketing specialties business.  You manufacture pens and other gadgets with company logos on them.  You have delivered $20,000 worth of merchandise to a customer, along with an invoice requesting payment within 30 days. This money owed to you is not yet available to pay for your bills.  Now, suppose a third party offered to give you $19,000 in cash today in exchange for your $20,000 invoice.  Would you accept the offer?  You certainly would if you needed cash today in order to pay your employees and buy supplies for new orders.  It would make it possible for you to stay in business and keep your customers happy.  Transactions like these occur everyday in the United States and abroad.

For more information log on to www.CreativeFundingSolutions.org

or send an email to NatticiaJames@CreativeFundingSolutions.org

And tell her you heard about it at LifestyleLounge.tv