Tips On How To Attain Financial Freedom
Everyone would like to have financial freedom, but we all wonder what the best path to attaining it is. Here are some simple, yet reliable tips to getting the freedom you desire.
Determine Your Debts
First, it’s not possible to attain freedom if you have no idea of what you owe or who you owe it to. Therefore, you must write down and add up every one of your debts so you can evaluate your financial situation. Once you have done this, you can make a plan for getting it all paid off as you continue you journey towards attaining financial independence.
Put your debts into a list with the highest interest debt first and use this as a priority list for getting them paid off. You can use something like a Snowball Debt Calculator, which is a method of paying off debts by paying the one at the top of your list first and putting as much money as you can afford on each payment, and paying the others only a minimum payment. Then, once the first one is paid off, you add that money to the minimum payment of the next one on the list.
Stop Spending Money You Don’t Have
You then must stop spending money you don’t have. Learn to be happy with the things you already have and use your available cash to spend down your debts. If you are forever buying every new toy or gadget out there, or doing things like buying those expensive fancy coffee drinks, then you will never attain financial power. You must stop getting further in debt or your dream will never come true.
Find A Way To Make More Money
If at all possible, look for ways to increase your income. Even if you can only do this by a few dollars, it can still make a big difference. The more cash you can find to help pay off your debts, the faster you will be able to continue on your journey freedom.
Reduce Your Expenses
Another thing you need to do on your path to financial freedom is to reduce your present expenses. If you are in debt, you need a strict budget. You must go through your expenses and cut out the ones that are not needed or are frivolous. For instance, you can live without the biggest package of channels for cable TV and stick with basic service. Plus, you should buy large bags of things like fruit, potato chips and snacks and not the little individual bagged ones, as they are much more per ounce. You can also skip buying coffee at places like Starbucks and just bring a thermos of regular coffee to work. Little things like this can add up to big savings that you can use to help pay down your debt.
Write Down Your Goals
While on the road to financial freedom, it’s vital to know your future goals. You need to come up with a long term plan of how you are going to become successful in achieving those goals. For instance, put down a date you plan to be out of debt, list a date for saving a specific amount for a down payment on a house, etc.
You should even write down some of your non-financial goals, as these are also important in your quest to gain financial independence. For instance, one of your goals may be to earn a degree, which would in turn help you to earn more money and therefore become more financially stable and independent.
Decide To Live Without Debt
Once you are out of debt, you need to promise yourself that you will stay out of debt except for large purchases like a home or a car. Even for these things, learn to not take on more than you can handle and work out a plan to get them paid off as soon as you are able. You may think it is impossible to live without always having to use a credit card or charge account, but if you are out of debt you will be able to make a budget for spending your available cash.
Invest Your Money
Once you are out of debt, you should find some good places to invest your money. Your money will gain much more interest in investments than in a low interest savings account or certificate of deposit. Take a class in investing if you are unsure of where to begin. Investments can include things like stocks, bonds, real estate and other items.
Look Out For Scams
It’s also vital to be in the know about possible scams that can take your money away from you. For instance, don’t fall for fake emails that sound too good to be true or say you have won millions of dollars from some foreign country or jobs that ask you to cash a huge check and keep part of it. These types of things are nearly always fake and will only take your hard earned cash away from you. There are many other scams that are not as easy to spot, so make sure you are current on the things going around by reading news headlines, and always do your research before accepting any kind of deal or getting involved in a project that seems too good to be true.
All in all, it is indeed possible to earn financial freedom and not be worried about how to buy whatever you want or need. However, to do so you must first be out of debt and then must take care of your available income and learn to use it wisely.