I've figured that when I'm investing I'm almost completely disregarding my bank account balance. I determine the amount of investment by looking at the free cash flow (By free I mean the money that is left after I pay all fixed costs) that I'm currently generating - especially the last 3-month average.

Why is that? Why doesn't my bank account balance play important role?

I believe that the bank account balance represents the amount of value that I've created in the past. However, it doesn't show if I'm creating any value right now.

When making an investment which amount I cannot precisely determine (e.g. development of a new product), relying on the most current free cash flow is superior predictor whether I can afford an investment (and what amount).

I've also figured that how well I sleep is much more corelated with the free cash flow I'm generating and not so much to my bank account balance (though I must confess that I keep a safety buffer in form of a bank account balance, which enables me to live for another year without impacting my lifestyle quality. And I never invest by cutting into it).