What does financial freedom mean to you?
Retiring early to travel the world? Having a self-sustaining business that does not require you to break your back to earn your dollars? Being able to focus on growing your blog? Spending more time with your family without having to worry about where you’ll the money to raise them?
Financial independence means different things to different people. By general consensus among those who have achieved it, however, there’s no better time to start working towards it than now.
Jumpstarting your plans to make money this year surely helps as you inch your way towards your goals. Regardless, here’s a framework that you can use in your journey to achieve financial freedom.
How To Achieve Financial Freedom (In 7 Steps)
1. Have a game plan
Freedom starts with a dream; victory with a plan. First, envision your goals. Finding ways to make passive profits can be a good start to achieving that goal.
When do you plan to be financially stable by? Use this question as a baseline to build a realistic framework of your current options that you can use as a guide to get you where you want to be.
2. Track your expenses and Start Budgeting
Budgeting a so much more than just stretching your pennies to make ends meet. To create a budget means to list your sources of income side by side with your expenses. Having a budget listed down or visualized can help you make smarter spending decisions.
3. Save as if you’ll live forever
A lot of people do not start out in life ever planning to get into debt at all but get stuck anyway because of failure to plan for contingencies. So when an emergency occurs and they don’t have savings on hand, they see borrowing money as next best thing, the easiest option.
The real best option is to actually start saving your money as soon as possible. Set aside a part of your monthly income for savings. Then make sure that you NEVER use those funds for anything else except real, genuine, life-altering emergencies.
If you’re blessed to have no untoward emergencies happen to you, that’s well and good. Keep your savings. It will go a long way into helping increase that nest egg you’re trying to grow.
4. Avoid debts – If you already have debts, stop incurring more
Eliminate debts from your life. Work towards paying off any existing ones you currently have. Don’t worry about whether you can manage to do so: you can.
First, list down any and all debts you may currently have. Now, this may strike fear into your heart at first. But seeing those numbers on paper makes them tangible. And it is easier to defeat that which you can see your own two eyes.
You’ll be pleasantly surprised at how liberating it is when you finally pay off the last cent you own on that student loan or auto debt.
5. Solidify your career plan
Financial independence doesn’t have to mean you need to quit doing work that you love. However, financial independence, short of a miracle, is not achievable without some kind of effort to expand your current sources of income.
You’ll also want to look into your taxes and company benefits to help you evaluate your career income plan.
6. Develop a more frugal lifestyle
Being frugal doesn’t have to mean starving yourself, wearing classless clothes or moving into the cheapest, most uncomfortable apartment you can lay your hands on.
It simply means you have to be wiser about where and how you spend. Getting to your goals will be a lot faster when you learn how to live within your means and cut back on your overall living expenses.
When you spend your money, make sure to focus more on your necessities instead of your wants. Look at the bigger picture and remind yourself that every little sacrifice you make brings you closer to your dream of financial freedom.
7. Make smart investments
Be on the constant lookout for money-making opportunities and chances to make wise investments.
Although no investment idea is fool-proof, understand the basics helps you take calculated risks that can pay off well in the long run.
Affiliate marketing, for example, is one of the most recommended ways to earn passive income these days, both online and offline. The caveat is that there have been and still are a lot of scam affiliate marketing schemes flying about.
For this particular reason, you have to do thorough research before deciding to get your hands on this particular investment opportunity.
Another money-making option that has been increasingly popular especially among bloggers is making money through Amazon, eBay or Shopify. There’s very little knowledge and skill required and payoffs are great.
There are hundreds of good options for investments that you can choose from. Research and ask questions to determine which ones fit you best.
Wrapping Things Up
There’s no straight, one-way road to financial independence. There are no one-size fits all scheme that you can buy into that will assure you of it.
Reaching financial freedom requires you to be flexible enough to weather all kinds of negative and positive changes without losing hope. It does take discipline and a lot of hard work.
But rest assured that every small step you make leads you to big rewards in your future.