The Goal to Become a Financially Independent Person
The bad news is that becoming financially independent might not be an easy task. Have you ever wished to buy yourself a particular item but you could not because you had to ask for money from someone? This is one of the main reasons why people strive to become financially independent.
If you are financially independent, you will not have to ask for money from other people. You will have all the financial freedom to do anything you wish for as long as you can afford it.
However, the road to becoming a financially independent person depends on how well you set reliable goals. If you do not set the right career goals, it might be challenging to become independent.
Earning your own money is the only assurance you can get to become financially independent. Some people rely on the money they get from family and friends, but this does not mean that they are financially independent. Such independence requires an individual to use the money they have earned from various tasks. It does not include the money you get from people because you still have to ask for a lot of money for you to spend it. In this article, you will learn about some of the ways that will enable you to become a financially independent person.
Set Realistic Goals
The key to becoming financially independent is setting realistic goals regarding your financial issues. These goals could include your education, career, spending habits, and how you spend money, among others. Realistic goals are the type of goals that you can easily achieve without much struggling. Such goals are also within your means, and this is what makes it easy for you to meet them.
If you set unrealistic financial goals, you are likely to get frustrated. Unrealistic financial goals mean that you are incapable of achieving them. For instance, you can have a goal of getting a high-paying job within a few months. These goals might be considered unrealistic because the job market is very competitive. If you do not get the job as expected, you will end up feeling frustrated. This might prevent you from achieving the other goals you have set.
Timeline
Resources
Before you set any financial goal, it is important to evaluate how long it would take you to meet the goal. This allows an individual to set enough timelines for meeting the goals. One of the reasons why people find it challenging to meet their financial goals is because they set a short timeline. If the goal is to be met within a short deadline, it means that the person has to work under pressure to meet the goal. The chances of meeting a financial goal while working under pressure are minimal.
It is also important to consider the resources needed for meeting the particular goal. Once you have identified the resources, it will become easy for you to determine whether you can meet the goals or not.
This would, therefore, prevent you from setting unrealistic goals that are bound to frustrate you. The more realistic your goals are, the easier it will be for you to meet them. This would motivate you to set more goals, this attaining financial freedom.
Change Careers
One of the reasons you do not have financial freedom is the lack of enough salary to cater to your financial obligations. When you have enough salary, you can afford to save money or invest in highly profitable projects. Such savings of investments would be your breakthrough towards financial freedom. If you do not have enough salary, you will find it challenging to invest or save the little money you have. This means you will continue relying on your salary until you get an alternative source of more income. This can be challenging because it will leave you in financial frustration.
Switch Careers
If you feel that your job is not earning you enough money to sustain your desired lifestyle, it is important to change careers. There are plenty of better job opportunities in the market. All you have to do is to become consistent in the search process. If you are determined to get better employment, you will eventually get it regardless of how long it takes. The journey to financial breakthroughs does not end overnight but might even take years. Therefore, you have to be patient regardless of how long it takes you to get better employment.
Side Job
In other cases, you might realize that your current career field will never make you enough money to attain your desired financial breakthrough. In such a case, you can search for alternative sources of income, such as working online. The extra source of income will be used to fulfill some financial goals such as saving and investing. This would be a great start for an individual seeking to become financially independent.
Learn a Relevant Skill
Given the current competition in the market, it has become harder to land a well-paying job than it used to be. The pandemic has also forced many companies to adopt the work-from-home strategy, leaving a substantial number of people jobless. This means that the demand for employment is low. Therefore, spending most of your time looking for a job might take you longer to achieve financial freedom.
The best thing to do is identify the most marketable skills in the market and take a short course to learn the skill.
These courses take from one to three months and are affordable. Once you have identified a course, study it and be keen to master all the necessary information. When offering a skill, an individual needs to offer good quality service to maintain a reliable customer base. If you establish a large customer base, you will find it easy to make an income. Most of the customers you offer good services to are highly likely to refer you to other people. This means you will continue enlarging your customer base and making more income.
The best thing about acquiring a skill is that you become your boss. Therefore, you will determine how much income you earn from the skill. You will also create a schedule depending on how busy you are. A skill is an ideal option for an individual seeking to learn a business. It will allow you to spare time to manage your business, unlike office jobs requiring you to work full-time. It will also allow you enough time to focus on other income-generating jobs, thus making it easy for you to become financially independent.
Hire a Financial Advisor
Another reason people lack financial freedom is poor money management. People with poor financial management skills do not know when to spend and when to save. They also do not know their limits of spending. Such people are good at impulse buying, a technique that results in wasteful spending. Regardless of the amount of money that such people get, it becomes challenging for them to save or invest and, therefore, easily fall into a financial crisis.
If you suspect that you are poor in financial management, it is advisable to hire a financial manager. The financial manager will help you control your spending, by determining what to buy and when to buy. They will help you avoid wasteful spending. This would leave you with extra money to save or invest. As mentioned above, the more money you invest or save, the closer you are to financial freedom.
Many people have a misconception that financial managers should be hired by the rich. Any person can afford a financial manager, and they just have to look for one within their budget. Once you have hired a financial manager, you can be assured that they will guide you towards financial freedom. Financial managers have a lot of expertise and experience in money management and, therefore, know the best decisions you could make regarding your spending. All you have to do is offer them access to all your financial information, and it will help you align your finances with your financial goals.
Let's Start Working Towards Your Goals Together
Invest In What You Have
People believe that one needs a lot of money to invest. The truth is that there are plenty of investment opportunities that you can invest with the little money you have. All you have to do is look for the right investment opportunity depending on your money. If you invest in the right venture, you can be assured of getting an income that will sustain your lifestyle.
When choosing an investment opportunity, you also need to consider how risky it is. When people make investments, they expect to get huge amounts of money. This is not always the case because some investments might take long before they start generating income. If you are looking for an investment that will earn you a lot of money within a short period, you should be willing to risk a lot.
Investing in high-risk ventures means that you can easily lose your money. Therefore, if you do not have a lot of money to invest, you should consider less risky investments. If you have a large amount of money to invest, you can invest some of it in risky investments that would easily generate large amounts of money. These investments might take a long to generate a substantial amount of income, but they are worth the wait.
Before you decide to invest your money in a particular venture, it is advisable to research more about the investment. If possible, talk to people who have invested in the specific venture before to gain more information on how to make your investment earn you money. The best part about an investment is that it will guarantee you financial independence now and in the future.
Save As Much As Possible
Another breakthrough to financial freedom is saving as much money as possible. The savings can be used to fund your life later when you are unable to earn an income. The same money could also be used to invest in a profitable venture that guides an individual towards their financial freedom.
Saving money might not be as easy as you think. If an individual plans to save money, they will need to have money discipline. If a person does not have money discipline, they might be tempted to spend all the cash at their disposal instead of saving it. Such a person might find it challenging to attain financial freedom. If you do not have savings, you are likely to fall into a financial crisis in the future when you no longer have an income. Therefore, it is important to save the small amount of money you have now because it will help you in the future.
You might currently have financial freedom, but the future is uncertain. For instance, you could lose your job, or your investments could collapse. In such a case, you will be left with no source of income other than your savings. Before you start saving money, set goals because this will motivate you to save more in an attempt to meet your saving goals.
Create a Budget
One of the reasons why people overspend their money is the lack of a budget. A budget is a tool used to control an individual’s spending abilities and track their expenses. If you create a budget, you will determine the amount of money you spend within a specific period. This would be your first step in attaining financial freedom. The budget will able you to cut all the unnecessary expenditures you have been incurring. The extra money obtained from the abandoned expenses can be invested in profitable ventures or saved for future use.
When creating a budget, it is advisable to list down all the basic expenses and the amount it would cost you to cater for them. Once you have identified such expenses and you still have money left, list your secondary financial needs depending on their urgency. For instance, you might be planning to buy a house or car. These are huge financial goals that need planning and budgeting.
The budget will help you set realistic financial goals and avoid frustrations caused by unmet financial goals. A budget will enable you to determine whether your current income is enough to sustain your desired lifestyle. If the income is not enough, you will have to look for an alternative to making more money. If you do not have a budget, you might always find yourself in a financial crisis, but you will never know the exact amount of money you need to get out of the financial crisis. Therefore, a budget is considered as a guide to financial freedom.
Live Below Your Means
Living above your means could be another reason you do not have financial freedom. If you live above your means, it means your current income is not sufficient to sustain your lifestyle. In such a case, you are highly likely to run into a financial crisis.
The best thing is to live below your means. This will allow you to have extra money that can be used as an investment or savings. The more extra money you have, the higher the chances of having a financial now and in the future.
If you are living above what you can afford, you should move to a cheaper apartment and purchase cheaper goods than you have been doing. If you are barely left with extra money to save, it means you are living beyond your means, and this will never get you to financial freedom.
Conclusion
Achieving a high level of financial freedom is the goal for every person. If you have enough investments, savings, and cash at hand to take care of your lifestyle, it means you have achieved financial freedom. Many people associate financial freedom with having a career. Financial independence is not all about having a job, because the salary might not be enough to take care of your desired lifestyle. In such a case, you will strive to look for money or borrow money from people to sustain your lifestyle.
Therefore, the moment you realize that you do not have enough income to finance your lifestyle, it is important to implement the above tips because they will facilitate you to become financially independent.
Financial freedom will offer you peace of mind, and this will make it easy for you to make more money. For instance, if your mind is settled or you are not in a financial crisis, you will find it easy to set realistic investment goals. You will not have pending financial obligations, and this means you can invest the extra money. The more investment you make in the right channels, the higher the chances of getting more money. If you have more money, it will get you far away from a financial crisis. Therefore, once you have attained financial freedom, it is important to continue making money to avoid running out of money. Whenever people get used to spending their money, it can be challenging for them to get through a financial crisis. Therefore, the goal is to continue making more money, regardless of how much money you have.