What can we learn from big business?
I work for a company that prefers Net 60 payment terms to its vendors. The goal is to receive the customer payment within 30 days or less and then hold the cash and make the payment to the vendor after 60 days.
So what’s the comparison to personal finance?
All of my spending is done on a rewards credit card. I make sure I stay within my monthly budget and pay the balance off on the due date. I have a high interest checking account so my cash grows while it sits there until payment time.
It’s not making me rich but it allows me to hold cash, gain some interest, and accumulate airlines reward points. I probably have about 8-10 free flights banked right now.
Businesses like to hold cash and pay debts at the very last minute. I believe in doing the same.
Let me know your thoughts on this!
Finance Ideas 101 