The Fourth of July is right around the corner. On this day, we are reminded of our Independence as a nation. But what about our financial independence? The goal of financial independence is to be able to cover all of your living expenses for the rest of your life without the need of a full-time job.
It may not happen for you until retirement, but it is possible! This goal may be achievable if you can exercise fiscal discipline while taking certain calculated risks. If you want to work towards financial independence which will take several years, but will be totally worth it, then check out the tips and advice below.
- Access Your Current Financial Situation And Where You Stand –
The path to achieving financial independence is a lifetime of smart money-management decisions. A young adult who sticks to a proven wealth-building plan can reasonably expect to reach the goal before retirement age. However, even middle-aged people may be able to achieve the dream of financial independence with strong determination, particularly through nontraditional methods. The first step is to create a budget (if you don’t have one already, which you should) and review it carefully. You cannot make smart money decisions if you don’t know where your money is coming and going each month. Check out this website for a free budget building tool: www.onlinebudgetadvisor.com
- Practice Makes Perfect –
You must set a strong financial plan and follow it very closely. Do not deviate or stray from said plan or everything will be at risk of falling apart. Be wary of reckless spending and impulse buys. They have a way of sticking around and making small problems into big ones. There are certain things you must NOT do to ensure your plan stays on target. Don’t live beyond your means. Don’t buy a vacation home even though you think it will be a sound investment. Don’t purchase new cars before your old one is paid off or no longer working. Last but not least, never borrow from your 401k or retirement plan for any reason.
- Become A Penny-Pincher Or Frugal Person –
Try to reduce everyday spending and make cutbacks on things that are not necessities such as an unused gym membership, magazine subscription, your morning latte, etc. People who achieve financial independence are extremely careful with their money. They only spend it when they have to (learn about a “want” versus a “need”). Wealth-building isn’t just about creating new wealth, but more about preserving it. Being frugal is a wonderful lifestyle with many benefits, and it doesn’t mean you have to live in a tiny one bedroom apartment with lawn furniture in your living room. You can still have nice luxuries and be comfortable while saving money. It’s all about making smart money decisions every single day.
Becoming Debt Free Starts Here
If you're ready to get started, try our FREE mobile-friendly online credit counseling system. It's the most comprehensive and innovative tool in the industry. Click the link below to get started.Get Started
- Eliminate Consumer Debt ASAP –
Start with your high-interest debt, like credit cards and auto loans. Some financial experts advise individuals to eliminate such debt by age 35. You might be past the age of 35, but it’s never too late to start. The number one reason people cannot reach financial independence is because of too much debt. Work hard to pay it down and become debt-free. Talk to a certified credit counselor at a non-profit credit counseling agency. The call is always free and they’ll let you know what your options are and how you can become debt-free as quickly as possible to reach your goals. Once you tackle your debt, you can focus solely on building wealth.
- Make Wise Investments And Stick With Low-Risk Opportunities –
Contributing to your 401k is a good start toward financial independence, but it’s often not enough. Learn about ALL available investment opportunities that you can. Start with standard exchange-traded funds and move up to more sophisticated investment strategies. Talk to a reputable financial advisor and a trusted investor. Check out dividend-producing investments and solid real-estate investments. A rental property can provide another passive income stream while you’re building equity in the home. Dividend-producing investments can also provide passive income, which can play a key role in helping you reach your goal.
- Be Flexible At Times And Unwavering At Other Times –
Be flexible and adjust your spending accordingly. Some years are bound to be more financially difficult than others, and you need to be able to deal with them. If you’re laid off, then cut expenses right away and adjust quickly. Don’t wait until you’ve used up your savings before you cut spending. The stock market could plunge and reduce your net worth by a huge amount next year. Instead of withdrawing money as usual, another option is to get a part-time job to pull through the rough patch. Being flexible means you’ll always land on your feet and live a less stressful life. Here are some more tips to help you survive job loss: https://www.advantageccs.org/articles/surviving-unemployment
- Believe That You Will Not Fail –
History is full of examples of entrepreneurs who built tremendous wealth, lost it all, and then regained their fortune, sometimes in a completely different industry. Setbacks and hard times will occur. But over the long term, you can achieve financial independence if you follow an authoritative financial plan. These steps should help, but you should always do your own research and find out as much information as you can about wise money management, smart investing, and good financial advice. Trust in yourself that you can do this.
Financial Independence is not easy to obtain. It will take hard work, sacrifices, discipline, and teamwork, but it will be well worth it in the end. This is not a get-rich-quick blog post, but if you apply these concepts, you will find yourself closer to financial independence. With the right amount of passion, dedication, education, and hard work, anyone can achieve their goals and dreams. When building wealth, the length of time to get to the finish is different for everyone. However, if you start today you will be one step closer than you were yesterday!