Seedly Cashflow 101

3 Steps To Earn More Passive Income Than Expenses

2 min read

What is the Rat Race?

You are stuck in the rat race because you have a current 9 to 5 job which provides you your only source of income currently – In the form of Salary and Bonuses that covers your expenses.

Goal: Passive Income > Expenses

The TL;DR (too long don’t read) idea is to plan your cashflow to actually break-free from this and achieve Financial Independence (a term known to many as FI). And that is merely the concept of building up enough “Income generating assets” to grow enough passive income so much that it covers your Expenses.

I will cover the individual components below. By the end of the article, you would be better able to craft your cashflow monthly!

Understanding this chart

Seedly Cashflow 101

STEP 1: Income Source

This is basically a pool of money which you get at the start of every month or quarterly or yearly.

  • Your 9 to 5 job – This should be self-explanatory! Basically your monthly take home pay and also bonuses
  • Passive Income – Refer to part 3. Basically if you have planned your cashflow right, you would have a growing amount of passive income coming into your account overtime which would give you less reliance on your 9-5 Job.

Some Questions you may have: 

STEP 2: Expenses

There are too many to cover here, but a HUGE part of our monthly cashflow. People often spend around 50 to 70% of their monthly salary on this category. So one good way is to learn to cut down your expenses or maintain it while growing your income base.

I would largely categorise expenses into two main buckets:

  • Fixed expenses – Utilities, Loan repayments, Insurance premiums, food etc. (things which rank close to food and shelter)
  • Variable expenses – Luxuries, Travel plans, gadgets etc.

Some Questions you may have:

STEP 3: Income Generating Assets

Basically this will be the main bucket to grow your ‘passive income’ overtime. Which will ultimately help you reach financial independence. The most important bucket*. Simply because there are many ways to grow this.

Low effort:

  • Dividend paying stocks – Basically some stocks termed as blue-chips offer stable dividends to shareholders (eg SingTel, Starhub, M1 telco stocks)
  • REITs – Real Estate Investment Trusts. A special class of stocks which are high dividend paying around 5 to 10% p.a basically because of the way they are structured

High effort:

  • Own your own business – Be your own boss. This sounds alot easier than it seems, but can start with something like Dropshipping as a home business (high effort)
  • Real Estate – This one can also be tough but potentially very high returns (via capital gains) and also Rental yield (2 – 3% yearly) Expensive to get in but in Singapore, it’s almost a sure-win in the long run (due to constraints on land)
  • Royalties – This is the next level, if you may have found a niche or brand in a certain area which others find value in. Take years of grinding and hustling to get here.

Some Questions you may have:

Conclusion: Build your ‘Passive Income’ Early!

To get towards your FIRE dream – Financial Independence Retire Early. It is extremely clear that you will need to build up your IGAs (income generating assets) for example in the areas of REITs and Dividend paying stocks early so that it can compound over time.

Then move on to other more leveraged (pricey bets) like property of which you’ll be able to rent out and start earning from that as well. All the best!

If you still need help, feel free to head over to our community to ask questions anonymously.

P.S: We found many pieces of cashflow concepts online but largely were skewed towards US market. At the recent Seedly meetup hosted by Kok Koon and gang, they got everyone together to play the board game: Cashflow. Upon some reflection, we decided to design our own local version of the Cashflow 101 in Singapore’s context which we hope you have found useful!


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