Financial freedom has a nice ring to it, and people think that it is unattainable. But it is not! With organization, knowledge, and control, anyone, even people with debt, can achieve financial freedom.
What is financial freedom, you ask? Well, it is when you have enough savings, investments, cash flow that allows you to live life on your terms. It means taking financial ownership and not letting money be the reason that you are not following your dreams.
When you attain financial freedom, you don’t have to work in an industry which doesn’t satisfy you. You can go for your passion because you have dependable finances to back you up. Or you can retire peacefully, as you have enough savings and investment.
Unfortunately, a lot of people don’t have this or any idea how to achieve it. Debt, daily expenses, uncontrollable shopping spree, emergencies, and all can break the bank of a person. A survey says that 10% of Americans have debts like car loans or student loan or credit card debts amount to $4.2 trillion in 2019.
It is a huge number which may sound disheartening to you. But here in this blog, we are leaving these negative thoughts behind. We are trying to become financially free, and with the tips, we will discuss below, you can achieve this.
Let’s begin.
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Set goals
To achieve financial freedom, having vague goals won’t work. You have to be specific about what your goals are. For instance, maybe by the age of 35, you want to save a specific amount or save enough to buy a big house or let go of the current profession to follow your passion.
For all this, you need stable finances. So, when you know what your goals are, you can plan and take steps that will help you achieve this.
Use all this information and create a planner. A financial binder, if you may, with all the data and some designs and images to keep you inspired. Take help from Canva to create a visually inspiring financial binder.
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Evaluate all your money and debt
After you have set goals of what financial freedom looks like for you, now it is time to evaluate your finances. So, take a deep breath and write down all the money that you have in your savings account. Now, write all the debt you have- bills, loans, mortgage, and more and calculate the number.
Next, how much do you spend monthly on groceries, rent, food, entertainment, and more. Write that down and again calculate the number. Now add this with the debt, and you will have the amount which remains with you. Now, it may be too low, but don’t lose heart. We will discuss some points to increase and decrease debt.
When you know all this, figure out how much money you have in your savings and retirement account and more.
Armed with this information, you will be able to take better steps towards your financial goals.
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Pay credit card bill on time and in full
Every month, you get a credit card bill and it is imperative that you pay it in full at that time only. It has a high interest rate, and if you keep it for later, it will put a dent in your savings.
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Be positive about money
A lot of people think of money as something negative, which is wrong. If you feel guilty about earning money, you will never be able to earn more or achieve financial freedom. Think of it as a necessary tool, which can help you live a life which you want and buy things that you need.
Don’t let negative thoughts consume you, even if you have debt. Otherwise dealing with it will be a problem.
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Create a budget
When you evaluated your money, you figured out how much money you spend every month on everything from grocery to rent. Now, that you know all this, create a budget so that you don’t overspend every month.
So, create a budget that includes rent, groceries, food delivery, travelling, restaurant outings, movies, and more.
When you figure out a budget which includes buying things that you want like clothes or accessories or gadgets, it will aid you in saving some money, because when everything is accounted for, there is no need to spend more unnecessarily.
Do account for emergencies or have a different account where you put some money for emergencies and use it only for that.
One of the best ways to save money is to invest it. Invest in real estate or stocks or anything that you are sure about and help you save and make more money. Yes, there are risks, but the risk is something yo
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Think about investing
You have to take if you want financial freedom.
Start by doing a thorough online research and investing a little bit of money first. There are online websites too where you can learn about investing money, use their help.
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Pay yourself first
Whenever you get your salary, the first thing you have to do is set aside some money for yourself. It is known as ‘paying yourself first’. Whether it is $1000 or 5000k every month, pay it to yourself. Now, whatever money you have will go towards paying bills, rent, and groceries. When you do this, you always have some money that you can use to invest in yourself, rather than using whatever you are left with after paying the bills.
Moreover, if the remaining money doesn’t cover the bills, take out another side hustle because that way you can save enough.
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Buy experiences
Instead of hoarding your money for long or buying things that you don’t want, everyone has won’t make you happy. Instead, go on date nights, or on vacation. This is better for in terms of experiences, and having financial freedom.
Financial freedom is vital if you want to live the life you always dreamt of. So, start by making one simple change and gradually start doing more, and in some time, you will start making conscious decisions that will push you towards the path of attaining financial freedom.