Financial freedom can sometimes feel like a big idea that is far fetched and not worth striving for. But let’s simplify it; what if financial freedom just means having control over your finances? What if instead of just going through the daily grind of things you made a plan for how to get to where you want to be?
What if you decided in ten years you were going to pay off your mortgage or buy that investment property- how would you get from where you are today to where you want to be? Whatever financial freedom looks like for you, I’m here to explain the steps you can take to get you as close as possible to those dreams you’ve been dreaming.
Steps to Achieve Financial Freedom
1. Figure out where you are and where you want to be
Do you have a clear picture in your mind about what financial freedom means to you? If not it’s time to start dreaming! Now that you know where you are headed, it’s time to look at exactly where you are.
It might feel hard, and even daunting but getting clear on exactly what is coming in and what is going out will help you figure out what direction you need to pivot into to get to where you want to be. Calculate exactly how much debt you have and how much repayment is going to cost every month. This will put you in the best position to get clear about your cash flow.
2. Create a Budget
Now that you’re clear on your cash flow it’s time to tell your money where it’s going. You’ve heard the saying to pay yourself first right? That’s exactly what I’m talking about, except when we say to pay yourself I mean to throw that money into a savings account. Any amount counts, just make sure that every month you’re putting something in your savings.
The next step is to calculate how much money you are spending on your expenses (keeping in mind any variables or non-monthly payments). Now that you’re clear on your expenses and you’re saving every month, track your spending.
If one month doesn’t go as planned don’t get discouraged, reevaluate, and then keeping going! You’re clear on what is going out every month and you are tracking your spending, it’s time to make sure that you are okay no matter what may come next.
3. Get Life Insurance
Life Insurance might feel a little out alignment when you think of financial freedom, but let me explain! Life Insurance is exactly what you need as you begin to get control of your finances and pay off your debts. The reality is, that anything can happen at any time to you or your loved ones and the financial burden that comes from the unexpected can be devastating. Life insurance ensures that no matter what is on the horizon you won’t be hit with a financial disaster on top of an already devastating situation.
4. Pay off your debt
This one isn’t fun or glamorous, but it will bring you one step close to your goal. Take a look at what you’re paying the highest interest rates on and tackle that debt first. Whether it’s little by little, or you’re able to put a large lump sum every little bit counts. As you finalize that payment focus on that picture of financial freedom in your mind. It will make it hurt a little less!
5. Keep more money than you spend
Feels obvious right, but what happens when your expenses start to creep up and your income remains the same? Either you increase your income or you bring down your expenses, but whatever you decide it’s so important to remember that it doesn’t matter how much money you make, it matters how much money you keep.
That might mean no more online shopping or maybe it means a less extravagant Christmas but whatever it is just know it will get you one step closer to that dream you’ve been dreaming!
Are you looking to get some help with your getting to financial freedom? I’m here to help you along the way. Call today for a no-obligation conversation!
