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Investopedia describes financial freedom as building solid savings and investments, as well as having enough cash to support the lifestyle we fancy for ourselves and our families. While this sounds practically like the life we are all out there trying to live, why is there the apparent struggle during retirement? The straightforward answer is the failure, during our young, energetic days, to make the right decisions, and this could be attributed to a number of reasons. But it’s never too late, and in this article, you’ll learn some smart ways to avoid falling into the same dilemma and boost your journey towards financial freedom.
Financial freedom cannot be achieved without being financially disciplined, and maintaining a budget will save you from making unplanned expenditures. Having a written budget will guide you from making unintended purchases, which puts extra pressure on your limited income. In the long run, you may be forced to look out for other methods of financial support, like borrowing, which may lead to debt. A budget should detail how much you have, let’s say in a month, and how much you can afford to spend after paying your bills. For persons who are debt-ridden, having a budget is non-negotiable as it ensures a good plan towards working your way out of such a situation.
- Make saving a habit
Just as you continue to maintain some fiscal discipline, overtime, you will begin to have extra cash on your hand. So long as you are not taking on new debt, you can start making plans for that big purchase you have always been looking forward to. Saving is okay but do so strategically. For example, save enough to increase your contingency fund so that you can pay for those unintended expenses while still able to enjoy the things that make life worthwhile. Like Chris Brogan said, “the goal isn’t more money. The goal is living life on your terms.” Financial freedom isn’t about just stockpiling cash but your ability to enjoy life without necessarily worrying about the unexpected life events that are mostly bound to happen.
- Grow your income
Having taken steps to secure yourself financially means you can now start preparing to grow your money. Yes, I am talking about investment. With this step, it is advisable to consult a financial advisor to help decide your investment alternatives. Investment can sound daunting, but with the help of financial planners like Equilibrium, you should be making the right decisions. There is no better time to start investing than now because it will afford you more time for your money to grow. Interestingly, this could curb your spending habits as you’ll be focused on allocating your money towards meaningful ventures. Be it shares, property, or bonds, the answer to the financial peace of mind you seek is taking action now.
- Consider your career choices
The journey towards financial freedom is a continuous one. It entails a series of decisions, right from the decision you make about your career choice. This makes it judicious to ask yourself some fundamental questions if you are to succeed in this quest. How much you earn, whether presently or in long-term benefits, would influence the decisions on saving and your investment strategies. How many years do you intend to engage actively in this work? Do you earn enough? Regardless of your choices, the path to financial independence is greatly influenced by your career choice, and so be careful making such a decision. Since all options may be right, ensure it is a smart choice. Always remember that working early towards retirement means you have to maximise your earnings now.
