During your working years the primary source of revenue is generally employment or business income. In retirement, the main sources of income are pension plan, government benefits, retirement income funds (RRIF) and investment savings. Business owners and professionals may have business assets that provide an additional income stream in retirement through dividends.

  

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At every stage of your life cycle, the cash coming in from employment should exceed what goes out to cover basic living expenses, discretionary expenses, debt repayment and taxes.

The exercise of optimizing cash flow by controlling expenses and minimizing taxes and debt will ultimately allow for greater surpluses. Due to the incredible power of compounding, even small changes in cash flows can have a significant impact on your long-term financial independence.