10 steps to Achieve Financial Freedom
Financial freedom might sound like a dream but this is the truth and is possible for anyone. By anyone, we mean anyone. Even if you are someone who is living with the burden of student loan, trust me, you can achieve financial freedom as well.
You might be struggling with finances today but there is always a way to get back to black. Here will give you 10 life-changing tips that will help you to make yourself financially independent.
Steps to Financial Freedom
You cannot become financially independent in one night. This needs both struggle and patience. Here are some tips that you can follow to make get financial freedom.
Understand where you are in life
You can never be financially independent if you do not know where you are in life currently. So, look at your list of debt, the saved money in your account and how much money do you need to face reality. This is a valuable life lesson.
Compile the total list of debt such as credit card bill, student loan, mortgage, etc. including the borrowed money from friends and family. Add this together, and figure out how much debt you need to pay. Even if it is a big number do not freak out. Start small and clear all the debts one by one.
Now, compile how much money is left in your account after repaying the debt. This is your saving. From this money, you have to start saving and make yourself financially independent.
Look at money positively
Keep in mind that, money is a good thing. Like everyone else, you deserve to have your own financial freedom. Money is necessary to live a better life. It buys you the basic needs such as food, shelter, medicine, etc. so, if you want financial freedom, you have to use money as your tool. If you look at money negatively then you are sabotaging your chance of making the best use of it.
Figure out your life goals
Everyone needs money but why do you need it? Do you want it to repay your debts? Do you want it to travel the world? Do you need to escape from the 9 to 5 grind in office? No matter why you need money, it is essential to figure out life goals.
Once you have your goals set, you can work hard to make things fall into places. You might not accomplish every goal in a day but when you know what you want from life, things become easier for you. This is the reason, it is important to figure out life goals.
Keep a track of your spending
Tracking expenditure is important. You might be earning a lot but if you keep spending without a proper plan then you are doomed. No matter how much you earn, you will always be broke. There are many apps on Appstore and Google Play that you can use to keep a track of your everyday expenditure.
With the proper tracking, you will also be able to save for your future.
Pay for yourself
There is proverb goes “pay yourself first”. This means that you should put a specific amount in your savings account before paying for someone new. This act of paying for yourself has helped many in achieving financial freedom.
Paying yourself first is a great initiative. This does not just help in saving but also keeps the individual away from overspending.
The mantra of making yourself financially independent is spending less. Yes, you might like that shoe from Gucci store or that bag from Prada but do you need a 1000 dollars bag when you have 1000 bills to pay for. Of course, not. The more you will spend the more you will get distracted from your financial goal. This is the reason, it is important to spend less. People will admire when they will see 1000 dollars bag in your hand but trust me, your future self will admire you for keeping that 1000 dollars in your bank.
Buy experiences not things
Life is short and you should enjoy it as long as it lasts. From my experience I can say, products cannot make you happy, the only thing that can make you truly happy is the experience. Will a new debt on your credit card make you happy? No. But memory will make you happy. So make new memories. Making memories does not need money.
Pay the debt
Clearing all your debt before retirement is essential. Some people might suggest you invest money in a new business but if you do not have knowledge of it, you could wind up with more debt.
Pay your debts and be relived. You surely do not want to drag your debts into life after retirement. If you really want to make yourself financially free, pay all the debts as soon as possible. Remember, the weight of debt increases with time. If you do not pay it today, it might get bigger tomorrow.
Make more sources of income
Your salary is enough to pay for your necessities but do you have any savings? If no, then this is the time you should consider starting a second job. Even if you have a 9 to 5 full-time job, try to do some business or part-time job alongside it. This will help you to save money for your future.
Invest in future
Invest in the future, this is because you want to be financially free. Get out of the debt and grow your savings account. This will help you greatly in the future.
If you want financial freedom then, go through these 10 tips. This will help you to manage your account better as well as carefully.