How to Achieve Financial Freedom Faster
Financial freedom is the long-term goal of most people. By definition, financial freedom refers to reaching a position where your combined investments, savings and on-hand cash are sufficient to fund your lifestyle indefinitely.
The road to financial freedom is peppered with potholes and obstacles; the single most prevalent of all is unnecessary spending.
It is no surprise that some estimates suggest that fewer than 10% of people will truly achieve financial freedom.
Even if it means making relatively major lifestyle changes, the rewards more than outweigh the effort involved. If you have set your sights on financial freedom and would prefer to achieve it sooner rather than later, these are the five things you should be prioritising as of right now:
1) Establish a Budget
The first and most important step is to establish a budget you can subsequently stick to. This means separating your wants from your needs, working out exactly how much you need to spend to cover things like mortgage payments, rent bills, utilities and essential shopping. Eliminate anything that is not strictly necessary and figure out how much you could save by minimising your monthly outgoings.
2) Pay Off Smaller Debts
All debts that involve interest payments are expenses you could do without. Consequently, paying off as many smaller debts as possible as quickly as possible is advisable. Every credit card, overdraft, personal loan and payday loan you repay will have a beneficial impact on your finances. It will also put you in a much stronger position for subsequently paying off the larger debts you have at a later date.
3) Create a Long-Term Plan
Even if it calls for the input of an expert adviser, you need to have a concrete plan in place for years; income protection in particular should be considered to ensure you are covered against all possible eventualities. The further in advance you plan, the more likely you are to achieve financial freedom.
4) Consider Investment Opportunities
This is something that should be done strictly under the advisement of a qualified and experienced professional. Making smart investment decisions can hold the key to transforming the capital you have today into something more substantial. As all investments carry a degree of risk, all potential outcomes must be considered carefully and discussed with an expert, before making any major financial decisions.
5) Save at Every Available Opportunity
One of the simplest and most effective ways of bringing financial freedom forward is to save, save and save. Each and every time there is the opportunity to put something to one side, do it; ideally, placed in some form of high-interest account or savings plan.