Contributed post
Financial freedom is a bit of a buzzword these days, but it’s something that you should look into if you want to live a high quality of life, have all the money you could need, and better still – not have to swap as much of your time for it as you do in your 9-5, or even in your own business!
Financial freedom is all about having the money to pay your bills and even live in luxury without swapping too much of your time. It’s about having money come to you while you’re sleeping. There are lots of ways you can do it, too; all it takes is a little research and a small investment on your part.
You’ll need to be willing to put the time in in the beginning, but then with most financial freedom techniques, you’ll be able to put minimal work into it while you enjoy the cash. Let’s talk about starting your journey to financial freedom. Read on and you’ll find important pointers, tips, and some ideas that could help you!
Develop A Clear Picture Of Your Vision
The first step is developing a clear picture of your vision in your mind. If you only have a rough idea of where you want to be, or even no idea at all, how can you expect to work towards it and achieve it?
It’s important to know a few things. Financial freedom doesn’t mean suddenly becoming a millionaire, or even becoming a millionaire at all. In a lot of cases, being financially free is going to take much less money than you think, providing you’re not thinking about spending silly money on pointless things all the time.
Work out how much everything is currently costing you, how much more money you’d like to have in the next year to live a comfortable life, and then choose that as your starting point.
Come Up With A Budget And Reassess It Regularly
Having a budget is crucial. This will help you to ensure you’re spending less than you earn, which is absolutely crucial if you’re working towards financial freedom. Financial freedom doesn’t mean blowing cash like there’s no tomorrow. It’s all about being smart and thinking about your future, and the quality of your life then, rather than spending a ton of money now.
Come up with a budget and make sure you keep an eye on it. See if you can cut things and make your expenses smaller as often as you can. If you’re smart, you should also think of your money in terms of ‘buckets’. For instance, 10% of your money goes in the savings bucket, 5% in the play bucket, 50% in the bills bucket – and so on. The rule is, you can’t take money out of another bucket for other things, even if you have some left over. No swapping. This is a great way to make sure you have everything covered and that your money is growing slowly.
Your goal should be to get your expenses as low as you possibly can. Can you switch your mobile contract for a sim only? Is there a membership you’re not using? Make sure you consider this carefully.
Get Out Of Debt
If you’re in debt, one of the first things you should aim to do is get out of it. You shouldn’t be putting any money into savings while you’re in debt. You should be aggressively paying off your debts to avoid paying high interest rates later on. Only then should you put money into savings. You’ll be used to not seeing a certain portion of your income then, too, so you should be able to put quite a bit away.
However, becoming financially free is not about putting as much as you can into your savings. It’s about working out a number for your emergency fund, saving it, and then leaving it alone. Once you have the correct figure, you want to focus on your projects and ventures instead. Money in a savings account will not work hard for you or grow, so don’t make this mistake.
Start Spending Less Than You Earn
Are you truly spending less than you earn? Many online bank accounts will show you stats and figures from the month’s spending, which can give you an eye opening idea on where all of your money is going. Use this to get better at managing your money and make smarter choices.
Getting into a place you want to be with your finances is definitely more about getting your mind in the right place at the start. If your mindset isn’t right, you’re always going to relapse and end up spending money that you don’t need to spend for short term satisfaction.
Aim For Financial Security First
Before you dive right in trying to achieve financial freedom, aim for financial security. This is where you have all of your bills taken care of, so you can focus on creating more wealth and income streams. Figure out how much you’d need to have your bills covered and what you think can help you to get there.
Explore Your Options
You have plenty of options when it comes to passive income. Start by picking one option and mastering it. Pick something that you’re interested in so that the momentum builds up as you go and you don’t get bored.
Let’s say you decided to start with dropshipping, even affiliate links. The first thing you’d need to look at is building a high quality website that people will use and trust. Looking at pages like web design review will ensure you choose a design that is going to get noticed and help you to get the results that you really want. People have literally gone from making nothing at all to making thousands with a great dropshipping website. Be patient, put the work in, and your efforts should speak for themselves.
Find Gurus And Learn From Them
It’s a good idea to find gurus and learn from them. There are many out there, and watching their YouTube videos, listening to podcasts, and reading their books can be very helpful. You have people like Tim Ferris and Tony Robbins, but then there are even channels on YouTube, like Project Life Mastery that can help you on your way.
Have A Plan For Your Cash As It Grows
Make sure you have a sensible plan for your cash as it grows. Just because you’re making more money doesn’t mean you should be putting less into your investments and blowing more on luxuries. Having a good plan in advance will stop you from making any silly mistakes. People who don’t have a plan for their cash are the ones who end up blowing every cent on fancy cars and going bankrupt.
Diversify Your Income Streams
Once you’ve mastered one thing, you can begin another project with the aim to diversify your income streams. You could try one of the following depending on what you’ve already tried:
- Affiliate marketing
- Blogging
- Drop Shipping
- Informational Products
- A Book/eBook
- Physical Product Sales Funnels
- Other Streams of Passive Income
- YouTube
- Stocks, shares, and other investments
There are lots of options, and just about anybody can get started. All it takes is a little trial and error to see what works for you – but don’t give up if something doesn’t work for you first time around. For example, one eBook is not going to make you a fortune. You should continue to write and market them to make money. The same goes for YouTube; it’s highly unlikely that one video will make you lots of money to begin with (unless it goes viral), so you’ll need to continue making videos, making a note of what’s popular with your audience, and then making more. You need to keep working hard at whatever you choose so that you continue making money no matter what.
Once you know what you’re doing, you should be able to put minimal time and effort into your projects, and many of them will automate themselves. That being said, they aren’t all 100% passive. YouTube videos aren’t going to make themselves, are they?!
Invest Your Cash
As well as choosing passive income streams, and assuming you have an emergency fund in reserve, you should look at investing your cash. This can be intimidating if you’ve never done it before, but there are account managers whose job is to help you make smart investments with your money. This is the only way your money will appreciate and grow. Start small and work your way up once you learn more. Knowing your risk tolerance is also important, as everybody has a different investment style.
Conclusion
Remember, the goal is long term wealth. Always pay yourself as little as possible, and keep on trying out different techniques with a clear vision of your goal lifestyle in mind. Enjoy the journey and you’ll get to where you want to be!