Financial Freedom

Financial Freedom: 10 Best Habits To Help You Get Freedom

Khyati Hooda
By Khyati Hooda 14 Min Read

Financial freedom isn’t just an excellent idea; it’s a necessity in today’s world — anyone who wants to build a stable and secure future for themselves must think about Financial freedom

Financial freedom isn’t just about not having debt or being able to pay your bills each month; it’s a way of life where you have the choice over what you do with your money and when you spend it.

You don’t have to be wealthy or own a business to achieve financial freedom. It is something that anyone willing to make some sacrifices can attain.

What Is Financial freedom

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Being financially independent allows you to act as you wish, whenever you wish. Financial freedom is about being able to afford the things you want and not worrying about money. It’s about having choices and having the lifestyle you want.

Financial freedom is different for everyone. It doesn’t mean you’re rich or have millions in the bank. It means you can choose how to spend your money and not worry about whether or not you can afford something. Your goals and values determine what is important to you.  

For some people, it may mean being able to retire early or being debt-free. For others, it means being able to travel or pursue a dream career. Whatever it means to you, Financial freedom is about being in control of your money and being able to afford the things that are most important to you.

1. Set Your Goals

What does it mean to you to be financially free? Everyone wants it, but it’s a too nebulous aim to set. You must be precise in your calculations and deadlines. The more precise your goals are, the more likely they’ll be successful.

Make a list of the following three goals:

  1. How much money you’ll need for your lifestyle.
  2. How much money you’ll need in your bank account to make that happen.
  3. When you’ll need to save that money.

Then, working backward from your deadline to your current age, set financial landmarks at regular intervals between the two dates. Put the target sheet at the top of your financial binder and carefully write down all amounts and deadlines.

2. Create A Budget

A spending plan is more commonly known as a budget. As you create this document, consider whether the items you list will bring you closer to your financial goals. When you create a spending plan, you define how you will spend your money each month. Will you want to include anything on the list that you don’t already have?

 It used to be difficult to budget if you didn’t have a pencil and paper or a spreadsheet, but now there are several options that make it easier. It’s also possible to use the same apps you used to track expenses to create a budget based on spending. 

Look at seven of the most effective budget spreadsheets to begin your journey to monetary well-being: The Budget Mom’s Budget PackageGoogle Sheets, Microsoft Excel, Vertex42, Tiller Money, Mint, and Personal Capital are all listed here.

An app can help you turn what may have been a time-consuming process into a quick and simple one. 

3. Start investing in the stock market

Investing in the stock market seems unusual to attain financial freedom, but it’s well worth the effort. When you begin investing, you are exchanging present funds for future money.  

  • At first, the returns you get from your investment might seem very small or non-existent, but over time, they will compound and grow significantly.
  • If you invest in a low-cost, diversified approach in the stock market, you can achieve substantial long-term returns. 
  • If you start investing at a young age and make regular contributions, you can achieve financial freedom in a few decades. 

When you start investing in the stock market, there is always a risk of losing your initial investment. However, if you invest in a diversified and long-term approach, you significantly reduce the risk of losing all of your money.

4. Track Your Expenses

The most important step to achieving financial freedom is to track your expenses. Setting money aside for emergencies or retirement if you’re currently living paycheck to paycheck may seem hopeless. 

To learn how much you can save, you must first figure out how much you spend. It’s crucial to keep track of your spending and write down everything you spend money on, whether it’s a cup of coffee in the morning or a major expense such as a mortgage payment. 

You can gather and categorize spending data using a free app like Mint or Marcus Insights. These apps can help you spot hidden expenditures in addition to identifying where your money goes. You’ll need to be diligent and adjust your behaviors to track your expenses. However, over time, seeing where your money goes is crucial.

5. Develop skills that are in demand

This is an excellent way to achieve financial freedom and ensure you have a job wherever you go. If you have skills in demand, like computer skills or basic engineering skills, or affiliate marketing there is a good chance that you can always find a job wherever you are in the world. You can take courses on websites like Simplilearn, and Wishpond masterclass for marketing.

Having skills in demand is an excellent way to ensure that you always have a stable source of income. This is especially important if you want to go off and start your own business. If you want to create your own business, knowing what skills you can market to other people is essential.

If you have the skill set to do something that other people want to be done, you will always find a way to make money. If you don’t have any skills or skills that aren’t in demand, it will be harder to achieve financial freedom on your own.

6. Passive Income

Looking beyond a day job to earn a living is likely the case for most people striving for financial freedom. You’re probably wondering how you’re going to pay off your debt if you don’t make enough money, right?

There are two ways to look at your sources of income. Passive income is money that keeps coming in even while you sleep, while active income can only be earned during the hours of the day. Here are a few things you can do to earn an active income while trading your time for money.

Problogger has virtual assistant jobs available.  Fiverr.com, TaskRabbit, Uber, and Upwork are just a few of the platforms that allow entrepreneurs to acquire new skills via online courses and monetize them. You may even pick up the odd job on Craigslist or other platforms.

In addition to these options, you can also increase your income streams with passive income such as: 

1. Starting a dropshipping online shop with Shopify, 

2. Starting a custom clothing business with Shopify,

3. Selling profitable content (blog, ebooks, courses, webinars, audiobooks, podcasts, apps), 

4. Becoming an affiliate marketer, 

5. Renting out properties you own, or 

6. Starting your own custom clothing business.

So follow up these simple steps to achieve your financial freedom and live your life happily without any hustle.

7. Build An Emergency Fund

To achieve financial freedom this is the most important and crucial step. If you don’t have an emergency fund, you may incur serious debt on your credit card if an unexpected expense arises. You might regret it if you deplete your savings to pay off debt more rapidly. You should divide your available funds between debt and saving priorities each month rather than prioritizing one over the other.

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After saving enough money to replace one paycheck, gradually build up the emergency fund until it can cover several months’ worth of expenses if you can’t work for any reason. 

8. Spend Less

It is essential to prepare financially in case of future difficulties, even if we can’t always prepare for life’s emotional or physical challenges. If you have a financial safety net in case of future problems is one way to prepare for the future. 

It’s true that plenty of wealthy people don’t look the part. Zuckerberg dresses the same every day, wearing the same plain t-shirt and jeans. By buying less, you can actually get wealthier. By spending less, two things work in your favor. Because you’ll have more money for your financial freedom, one thing that you’ll learn is that you don’t really need as much as you think to survive.

You also must make sure you have adequate insurance coverage, as there is no telling what the future has in store. Accidents happen, work injuries occur, and natural disasters are capable of causing thousands of dollars in damage to your home. To prevent these scenarios from eating away at your cash, you should get the right insurance to achieve Financial freedom. 

9. Financial Advisors

It’s time to get a financial advisor to achieve financial freedom if you’ve amassed enough liquid assets or non-dissolvable property to maintain a steady course once you have enough wealth. 

Some people prefer to handle their own finances and investments, but others require this final step. 

Specialists are necessary for certain things. Once you’ve got the fundamentals down, you can seek professional assistance for more complex issues, including retirement planning.

 A financial planner or tax advisor can help you assess your current situation and plan for the future by meeting with you once a year. By seeking the advice of an independent professional, you may gain objective advice and tips you might otherwise miss if you tried to go for financial freedom alone.

10. Automatic Savings

It is critical to set up an automatic payment into an emergency fund, which can be used for unexpected expenses, as well as for an automatic contribution to a brokerage account or similar service. Enroll in your employer’s retirement plan and maximize any matching contributions. This plays a major role to achieve financial freedom.

Having an automatic deposit into an emergency fund is also recommended, which, aside from having unexpected expenses, can also be used to pay them. Ideally, the money for your emergency fund and retirement fund should be withdrawn from your account on the same day as your pay, so you never touch it. Remember that the amount you save in an emergency fund will depend on your personal circumstances.

 Furthermore, you cannot access your retirement account funds unless you meet certain requirements, so that account should not be your only emergency fund.

Conclusion

Financial freedom isn’t just an excellent idea; it’s a necessity in today’s world. Financial freedom is essential to building a stable and secure future.

Financial freedom isn’t just about not having debt or being able to pay your bills each month; it’s a way of life where you have the choice over what you do with your money and when you spend it. It is something that anyone willing to make some sacrifices can attain.

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Posted by Khyati Hooda
Khyati is an entrepreneur, marketing consultant and growth hacker. She helps sustainable revenue growth through marketing for SaaS and subscription companies. Her expertise lies in building scalable customer acquisition strategies and implementing effective digital marketing campaigns that drive high-quality, low-cost leads for startups. Khyati has managed over $50M in marketing budgets across various industries including technology, finance, education, retail, consumer goods and more - successfully delivering over 15x ROI for her clients.
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