At some point in our lives, we gain an urge to be financially free. To be able to pay that pesky bill without worrying about how badly it will hit our pocket. Financial freedom enables us to take care of the important things in life without the stress of realizing how much certain things will cost because we are fully equipped for that cost. We control our finances instead of the finances controlling us.
However, the road to financial freedom isn’t a flower bed, a land of honey and milk where we enjoy life without any care for money. In fact, our responsibilities are enhanced, and it takes a lot of hard work and dedication to gain this financial freedom. This article lays down the steps of how you can indeed become financially free.
Firstly, you need to define what financial freedom means to you personally
Is it choosing a career you have always dreamed of without the worry of how much it pays? Is it the chance to retire in your 40s? Or is it having enough cash to buy that stunning Lamborghini you have always pictured in your front Porsche?
Financial freedom makes these dreams a reality. For this financial freedom, it takes a good deal of planning. You must be able to track each and every penny or cent you are spending throughout the course of the month. You can adjust your spending according to how much you are underspending or overspending on each aspect of your spending plan.
It is a good idea to create a unique budgeting scheme for each month. Once you have gotten to grips with your monthly budgeting, you need to then identify which debts you own, whether it’s car loans or student debts, these need to be taken care of sooner rather than later if you truly want financial freedom. You cannot properly be financially free if a significant amount of your income goes to these debts.
Paying off debts means that your income belongs to you and you only, meaning that the short-term goal has to be debt-freeness. Career choice is of great importance when it comes to financial freedom. The aim has to be to find a job with you both enjoy and gives you financial security.
Does the job support your overall life goals?
How good is the earning potential as long as you progress? What opportunities exist for career growth? So career choice is something which shouldn’t be taken lightly. For true financial freedom, you must be well prepared for unexpected events in life. Cars will break down, medical requirements will arise, and house repairs will be needed. That’s why emergency savings should always be kept to cover such costs. Having a short-term savings account gives you budgeting flexibility that you need.
Finally, the step which will propel you to financial freedom is an investment. The sooner this step is achieved, the more potential there is for financial growth. For example, investing in real estate is a popular endeavor by financial freedom seekers. If you decide to by a house, it could grow in value over the years and net you a fortune. It may seem like a long road require certain sacrifices, however, when you are financially free, you will realize that all that effort was certainly worth it.