- He tries to minimise the cash that he has because to him, it is a small loss
- Short to Medium term spending goals are funded by low-risk but not no-risk assets
- As much as he can, he will choose to self insure
- A lot of his spending goals are funded by a stock equity portfolio
Dan Egan, the Director of Behavioral Finance and Investments at Betterment, put out a piece about his cash flow management and budgeting.
I think it is a great piece because, firstly, he shares with us his philosophy of why he manages his cash flow this way.
Secondly, it is because his philosophy, the way he looks at his cash flow, and his budgeting accounts is very different from the traditional setup: