liquidity management
Liquidity management refers to the process of ensuring a company or individual has enough cash or easily accessible assets to meet short-term financial obligations. It involves balancing incoming and outgoing funds to avoid cash shortages or excesses. Effective liquidity management helps an entity respond to unexpected expenses, maintain operations, and invest in opportunities without disruption. In essence, it's about being prepared financially to cover bills and other immediate needs without compromising long-term financial health.
Additional Insights
-
Liquidity management refers to how individuals or organizations ensure they have enough cash or easily accessible assets to meet their short-term obligations, such as paying bills, salaries, or unexpected expenses. It involves balancing the inflow and outflow of cash to avoid shortages. Effective liquidity management means having the right amount of cash on hand while also investing or utilizing excess funds wisely to generate returns. In simpler terms, it’s about making sure there’s enough money available when needed, without leaving too much sitting idle.