Many people out there think that financial freedom is something they will never achieve, however, it is possible, and it takes work.
If you’re one of these people who tends to think that financial freedom is too far out of reach, you might be surprised to learn that by changing how you live, you can eventually turn things around.
Financial freedom happens when you take ownership of your finances and you start to make changes so that you can live a more comfortable future.
Making changes gradually is key, as is changing your mindset. Below, you’ll find 10 things you should start doing now to help you achieve financial freedom.
1. Change The Way You Look At Money
Start by changing the way you view money. Be honest with yourself about how you look at it now. Many people see money as ‘the root of all evil’ and all kinds of crazy similar things.
The fact is, if you view money negatively, it can subconsciously undermine your chances of earning and keeping it.
You need to realize that money is simply a tool that can help you to live a better life. It is not evil, and it is not the best thing in the world. You need to appreciate it, without worshipping it.
These things may sound like contradictions, but if you can be grateful for the money you have while still wanting more (without that air of desperation or resentment) then you’re already going to be in a better place mentally.
2. Write Down Your Goals
Why is it you want to be financially free? Many people say that they want to get out of the 9-5, some say they want to travel – many want to do both. There may be an abundance of reasons you want this for yourself. Writing down your goals is another key step when you’re on your way to achieving financial freedom.
Ideally, you need to tie any goal to something that’s emotional enough for you that it prompts you into taking action. Being specific about what you want to achieve is essential, and making sure it makes you feel good feelings is imperative.
If this goal doesn’t mean anything to you deep down, then you’re not going to have much incentive for wanting to achieve it. You can then make a solid plan to achieve your goals and look at them each day to remember why you’re doing what you’re doing.
Write down your goals and all the steps you need to take to achieve them. Look at the list daily and start taking action towards reaching them. Tick off each step when completed.
3. Take Precautions To Protect Yourself
You’re going to need to take precautions to protect yourself, for example, making sure you have an emergency fund to avoid getting into debt, as well as making sure you’re prepared for anything that could happen (what would you do if you lost your job?).
You should also make sure you have things in place like home insurance and life insurance to protect from the worst happening. If you’re asking how does life insurance work? Then make sure you do your research and figure out if it’s something you need. Those with dependents will find life insurance useful, even if it’s just for peace of mind.
4. Be Vigilant In Tracking Your Spending
You must be vigilant in tracking your spending if you’re going to achieve financial freedom. Tracking your spending will help you to become more mindful of how you spend your money, as well as give you an idea of where you can improve. Get comfortable with tracking – you can even download apps to do the hard stuff for you.
5. Pay Yourself First
Paying yourself first means putting a set amount of money into your main bank account before setting money aside for things like debts and bills. If you like, you can set up a direct debit to your savings accounts so you don’t even have to think about swapping the money over.
You need to make sure you’re paying yourself enough in terms of food and perhaps even the odd luxury, but you also need to take into account things like a pension and savings.
6. Live A More Minimalist Lifestyle
A lot of the time, it’s not about how much you earn, but how much money you’re keeping. Most people tend to live beyond their means – even those who don’t live beyond their means end up spending the majority of the money that they earn, especially nowadays with the cost of living so high.
By living a more minimalist lifestyle, you can make sure you’re not wasting money and that you’re keeping as much of it as possible for important things. Here are a few ideas that can help you:
- Buy a reliable car, rather than a flashy car
- Create a capsule wardrobe to eliminate the need to buy lots of clothes
- Don’t clutter your home with too much furniture and accessories
When you keep the things you buy to a minimum, you can put an emphasis on quality so that you A) don’t have to buy twice, and b) love everything you buy. It’s all about quality now, not quantity.
7. Spend Your Money On Experiences, Not Things
While you want financial freedom, these efforts are not about hoarding all of your cash. Travel is one of the only things that can help you to become richer in terms of experiences, culture, and knowledge. It also gives us that sense of freedom we’re all longing for.
Life is made up of moments so make sure when you do choose to spend money, it’s on things like travel and experiences rather than ‘stuff’.
8. Work Towards Paying Off Your Debts
Paying off your debts is one of the most crucial elements of financial freedom. If you have a lot of different debts, you can see if you can consolidate them into one loan. This will be a large payment you pay off in one around once a month, but it can help you to stay on top of everything.
If you don’t know which way to turn in terms of your debt, turn to a financial advisor who can help you.
Remember, paying off your debts should come before you begin investing or saving a lot of money, as the interest you will have to keep paying adds up.
9. Figure Out How You Can Create Extra Sources of Passive Income
Passive income is one of the most important parts of achieving financial freedom. You can try:
- Writing Ebooks
- Creating low-content books
- Creating printables to sell
- Creating YouTube videos
- Creating a course or guide you can sell multiple times
- Cashback rewards
- Vending machines
- Create an app
- Start a blog
- Affiliate Marketing
The idea is that you put a little work in but you keep on making money while you sleep – you don’t keep on swapping your valuable time for money!
10. Make Investments – Investment Apps
Investment apps are software applications available on smartphones, tablets, and computers that allow individuals to invest in various types of assets.
These apps can be used for trading stocks, bonds, mutual funds, ETFs, cryptocurrencies, and more. They make investing more accessible, easy to understand, and convenient by providing tools and features that can help users manage their investments and make informed decisions.
It can be tough for beginners, but there are investment apps out there now that will do pretty much everything for you.