Steps to Achieve Financial Freedom

Many people avoid their financial situation because it’s too overwhelming for them to bear. However, there’s no way you’re going to truly achieve financial freedom when you don’t know your numbers. Therefore, it’s time to make line items that clearly state the debt you carry. Include your student loans, car payments, and credit card debt. If you have an outstanding bill from a debt collector, put it on the list. If you have a mortgage, put that outstanding amount as a line item as well. You have to get clear on what you owe if you’re going to set your financial freedom plan in motion.

Next, you’ll need to consider your current expenses and your income. Depending on your situation, you might need to emphasize one of these considerations over the other. Granted, you’ll still need to implement strategies to make more and spend less. Still, it’s essential to get an understanding of your expenses and your income to detect any chinks in your armor.

Notice any patterns. If you overspend during the last week of the month, take note of why. If you don’t have enough money to cover all of your expenses, it’s not just about cutting back. In order to achieve financial freedom, recognize that an abundance of money is an essential component within the big picture.

If you’re used to living from paycheck to paycheck, the idea of financial freedom might already feel like a lofty goal. Thankfully, there are practical ways to break everything down into achievable goals. Depending on the scope of your financial situation, it might take several years before you can be financially free.

It’s important to note that financial freedom will look different for everyone. If you’d like to quit working to stay at home with your children or grandchildren, you’re able to do so. If you’d like to go on a mission trip for six months or live in another country for half of the year, you’re not financially dependent on a location-sensitive job to make this happen.

If you don’t have any money saved in an emergency account, you can start by saving $1,000. Look at your finances to see how quickly you can put that money into your account. You may need to find a part-time job, sell some items around the house, or look for a full-time job with better pay. These are great action items to get the ball in motion.

Think about when you were in high school or college. Your educational career was mapped out for four years. You knew the classes you’d need to take and the moves you needed to make for the next four years. Apply the same logic to your financial life by setting short-term and long-term goals

Before you pay bills or spend in other ways, pay yourself first. You pay yourself by setting aside money in a savings account. Whether you’d like to face it or not, the fact is that rainy days will come. When you have a rainy day fund set aside, it will help you ride through the storm more easily. Whether you get sick or lose your job, you’ll at least have money set aside so you can focus on getting back to normal without incurring a greater financial burden.

A wise person once said that when you know better, you do better. This is why your financial education is so important. No, you don’t need to enroll in the nearest university to get a degree in finance. Instead, you need to start by reading books and articles on how to improve your finances. Read books about creating a foolproof budget. Take a course on how to invest in real estate. Learn how to build a full-proof wealth-building strategy.

If you set a goal to read a new financial book every month, this will make an impact on your financial life in major ways. As you read and implement the lessons you learn, you’ll create positive habits around your financial life. Get creative in developing a curriculum that honors where you are in your financial journey. Before you begin investing in the stock market or real estate, learn the vocabulary and the trends. To become a master, you have to start as a beginner. You’ll do yourself a disservice if you try to skip steps.

Jim Rohn famously stated that “you’re the average of the five people you spend the most time with.” If you don’t like what your financial life looks like, take a look at the people around you. While you don’t want to discard people, you have to be mindful of the influence people have on you. If you want to start living a better life, you have to start cultivating better friendships that inspire you to be your best.

Cultivate relationships with people you’d like to be mentored by. Join meetups where people discuss personal development, professional development, and financial freedom. Start waking up early to go to the gym. As you look around and see who’s there in the early hours, cultivate relationships. As the opportunity presents itself, ask about what they do. Let relationships evolve organically. It’s still important, however, to show up in various places to look for people who are on the same wavelength as you.

When you’re carving out a path for your financial freedom, there are decisions you’ll have to make. Some of those decisions might lead to a temporary feeling of discomfort. It might feel uncomfortable to tell your friends that you can’t join them for drinks every week. However, you can shift to meeting up with them every other week. You might have to wait another few years before you can purchase your dream home. However, when you’re able to quit working because your investments maintain your lifestyle, there’s no better feeling. Remain focused on your goals. As you forgo the temporary discomforts, you’ll set yourself up for long-term gains. To get started on your journey to financial freedom, contact us today at Factum Financial.