Cash is like air. If you run out, even temporarily, you don’t get to play another day. You must manage to ensure you don’t run out of cash.

It takes a lot of effort and forecasting to manage cash close to running out, without actually running out. So do whatever it takes to build up a cash buffer and remove the need to manage cash so precisely.

Buffer in place, and thus freed from worrying about tomorrow’s air supply, you can focus on maximizing long-term return.

A person prioritizing cash flow will try to avoid a big investment opportunity (a $10,000 equipment replacement, for example) that pays well in the long term ($2,000 savings per year for 20 years = $40,000).

A person prioritizing long-term return will rejoice at such “expensive” opportunities.

Create that cash buffer, prioritize long-term return and you’ll create a snowball effect as increased returns provide increased cash to fund even more long-term return opportunities.

P.S. This works equally well in personal life, business, and nonprofit orgs.