How to Achieve Financial Freedom and Live Life of Your Dreams

Of people who made New Year resolutions for 2019, 35 percent wanted to stick to their budget and achieve financial independence.

Are you one of these people? Even if you aren’t, it’s likely that you aren’t comfortable with your financial situation. After all, in a country where most workers survive on paychecks, not many people can say they’re financially free.

Yet, financial freedom is a powerful and beautiful state to be in. When money isn’t one of your worries, every other thing tends to fall in place.

Continue reading to learn how to achieve financial freedom and live the life of your dreams.

What Does Financial Freedom Mean to You?

For some people, financial freedom conjures up mental images of people having wild fun on a cruise ship in some far-flung island. For others, financial freedom means having boatloads of cash in the bank and being able to afford whatever money can buy.

Clearly, financial freedom means different things to different people.

The first step to being financially free is to establish what it means to you.

Whether yours is to have enough money left after taking care of bills or being able to save up enough so you can retire at 35, understand that there’s no one-size-fits-all definition for financial freedom.

Establish the Reasons You’re Not Financially Free

Now that you have crafted your own version of financial freedom, why are you not there yet?

If you’d love to have enough money left after paying the bills, you probably aren’t pulling in enough income. Perhaps your job isn’t paying you as well as you’d like or your business isn’t making a lot of profits.

Either way, establishing the reasons you’re not yet financially free gives you a picture of what you need to change. For example, if you’re a career person, one of the things you’d have to do is pursue a promotion, find a better job, or even switch careers…just anything to increase your income.

Start Living within Your Means

Far too many people in the United States, especially those in the middle class, live beyond their means. If you’re putting your finances on a strain just so that you can lead a certain lifestyle, you’re only setting up yourself for a lifetime of financial misery.

It’s time to start living with your means.

First, start by having a good handle on your monthly expenses. Track everything from domestic bills and loan repayments to money spent on gift cards and unplanned coffee dates.

At the end of the month, you’ll have a figure that indicates how much money is going out. Subtract that from your net income.

Do you like the balance? Is there even a balance in the first place?

If your answer to either of these questions is no, you’re living well beyond your means. The remedy is to cut back on your expenses.

Depending on your specific circumstances, cutting back could mean taking drastic measures such as moving to a cheaper home if you’re renting. It could also mean taking simple measures such as terminating your streaming subscriptions, eating home often instead of going out, and going easy on the movie tickets.

Manage Your Debt

Debt isn’t a bad thing. It helps you build credit, can get you out of a sticky financial emergency, and makes it easy to acquire big-ticket items such as a car and a home.

However, when you’re not careful about the amount and type of loans you take on, you could spiral into a deep hole of debt. Unfortunately, this is a mistake that’s all too familiar to most Americans, considering that consumer debt has now hit $4 trillion – a record high.

You don’t have to be debt free to be financially free. There are billionaires who’re still paying off mortgages – if that makes for some validation!

But, ensure your debt is manageable. If you have multiple credit cards and loans, prioritize paying off those with the highest interest, or you can take out a consolidation loan at a lower interest rate.

Build Your Credit Score

A good or excellent credit score enables you to easily secure loans at attractive interest rates. It also comes in handy when you’re looking to get a mortgage.

If your credit is currently in the red, start building it. Make your payments on time, keep your credit utilization low, and pay off your debts. And if you need a loan to help you build a positive payment history, lenders such as Jora Credit have you covered.

Save for a Rainy Day

Three things are certain in life: taxes, death, and a rainy day!

Your car could break down when you’re broke. Or you or a loved one under your watch could fall ill suddenly. Or a natural disaster could destroy your home. In short, unforeseen emergencies are part of life.

The good bit is you can prepare for these emergencies by building a healthy rainy day fund. Develop a habit of saving a portion of your monthly income and you’ll never have to worry about financial emergencies.

You’re Never Too Young or Too Broke to Invest

Investing is the surest way to build wealth, achieve financial freedom, and retire early. Whether it’s a unique day trading strategy, investing in penny stocks, or simply a low-risk index fund, it’s the path to achieving financial independence.

Never assume that you’re too young or financially unstable to start investing. Warren Buffett was just 11 when he made his first investment – a $114 investment in a natural gas company. Look at his billions now.

Like Buffett, you could buy stocks and wait for your money to grow over a long time. You could also venture into real estate or even start a small business.

Keep Learning How to Achieve Financial Freedom

We all want to free ourselves from the chains of financial uncertainty. We want to lead a life where money isn’t a problem.

This isn’t out of your reach. With this guide on how to achieve financial freedom, you’re now in a better position to make smart financial decisions and start taking strides towards the freedom you crave.

All the best and keep coming back to our blog for more financial tips, tales, and insights.

Thanks to Ana

Speak Your Mind


Copyright 2014 @ A Celebration of Women™ The World Hub for Women Leaders That Care