- Learn Budgeting
You may not likely move ahead if you don’t have plans for your money. Instead, you’ll find yourself wondering where your money went at the end of every month.
Financial freedom is impossible if you’re not living on a budget. You must develop the ability to tell your money where to go, or you’ll end up wondering where it went.
Give your money an assignment before the month begins and track your spending throughout the month. If you consistently overspend or underspend in certain areas, you can always adjust the amount in those categories.
Budgeting is important to put your finances on the right track no matter how much money you earn you need to plan. No one win the big championship game by accident, and you can’t get to financial freedom by accident either.
Budgeting is the first step you should take to building wealth on purpose. Start budgeting with confidence and take control of your money.
- Never Involve In Debt
Until you realized that your income is your most powerful wealth-building tool. And you won’t reach your money goals if all you’ve got to work for is using larger percentage of your income to service debt like credit cards, student loans, car loans and house mortgage. As long as you’re sending hundreds of your hard-earned dollars in debt payments to banks and lenders every month, you’ll never truly experience financial freedom.
If you are usually ready to begin your debt-free journey? This is the time to focus on paying off your debt. If you are zero-tolerance to any form of debt in your life this will helps you lay a good foundation to build wealth that will last. Throw all of that extra cash at your smallest debt until it’s all gone. Paying off debt is hard work, but there’s nothing like the feeling of actually keeping the money you bring in every month.
- Set Financial Goals
Remember that a dream without a goal is just a wish. That’s one reason you must make your financial goals a priority. This should include getting out of debt or saving up for retirement, in other to make your journey to financial freedom very easy. Setting your financial goal gives you something to work toward.
Here’s how to set goals that actually work:
- You should be specific about your goal.
- Make your goals measurable.
- Give yourself a deadline.
- Make sure they’re your own goals.
- Put your goals in writing.
Let’s say you usually want to get out of debt. That’s a fantastic goal to have, but that may not be enough until you specify how much debt do you want to pay off? Is it $10,000? Good, now you’re getting somewhere! When do you want to be debt-free? How does 12 months sound?
And just like that, you now have a specific, measurable goal that’s personal to you with a hard deadline attached to it: I want to pay off $10,000 worth of debt in 12 months. Now all you have to do is write it down and keep it front and center as you go after it.
- Choose a Smart Career
Realizing that your biggest wealth-building tool is your income. So why choosing a career, there’s a lot at stake. Don’t stay stuck at a dead-end job, especially if income will not support your financial goal. Find a job you enjoy that will also supports your goals so you can enjoy the journey. If your present job doesn’t look like taking you to your destination, change your job.
So, what should you look for? Here are a few things to keep in mind:
- Where are you in 10 years? Start with the end in mind. Does this job make sense with your overall goals?
- Will the income sustain you? Even if you’re not making your dream salary from the start, make sure there’s opportunity for your income to increase as your value increases.
- Can you grow her? Are there opportunities for you to move up and grow personally and professionally?
- Do you love the work? Don’t spend a career at a job you hate. Find something you’re passionate about that allows you to use your gifts, talents and skills.
- Do the benefits support your goals of financial freedom? Your options for retirement savings and health insurance can dramatically affect your ability to build wealth. Your choice of career can have a big impact on your long-term financial plan, so take it seriously.
- Keep Money for Emergencies
If your goal is financial freedom, you need a fully funded emergency fund. It acts like a buffer between you and the unexpected life events that happen to all of us, like car repairs, broken appliances, school fees and medical bills. That’s why you should increase your emergency fund to cover 3–6 months of expenses once you’re out of debt.
Having the cash on hand to cover an unexpected life event gives you peace of mind and is a critical part of your overall financial plan. Once you have that fully funded savings account, you’ll start to feel more flexibility in your budget.