Six crucial steps to achieve Financial Independence
Good Ol' Independence
When many of us think of independence one thing that comes to mind is freedom not being control and doing things on free will. The same rule applies for Financial Independence in which is thought about as much as it should be. Let me rephrase the thought is there but the action is not. Financial Independence basically comes down to not letting money be in control instead having a person being the one pulling the string. Getting there doesn’t have to be as hard as it may appear. Here are the Six Steps necessary to achieve that goal.
1. Debt Management
2. Emergency Fund
3. Cash Flow
4. Proper Protection
5. Build Wealth
6. Estate Preservation
1) Debt Management
One of the biggest roadblocks in achieve financial success is debt. Many people don’t know how to combat it correct however with proper strategies this can be overcome. For example, create a spread sheet to list all bills, miscellaneous and monthly amounts. From there on find out what can be cut out and put it towards major debt particularly credit cards and auto loans. This method can help pay off these items faster.
2) Emergency Fund
While figuring out any cost saving areas another item that must be address is an emergency fund. AT least once in our lives an emergency is bound to happen therefore it is crucial that a fund is set up for that particular purpose. Along with paying off debts excessive funds should be solely directed to that area.
3) Cash Flow
Not earning enough funds? Become a part of the gig economy where you start earning extra funds doing what you love. If you have a gig or business consider another stream of income the gig economy is growing fast thanks to the internet therefore finding something can be very easy. Examples are dog walking, ride sharing even become apart of the financial service industry teaching other people how money works. With a few clicks online finding a gig can become quick and easy.
4) Proper Protection
Earning extra money is beneficial however if you don’t protect it chances our it would stay that way for long. The main point of protection is Life Insurance. Life Insurance isn’t just for an individual but for love ones are affected as well in the event something major happens. After one passes away expense can occur therefore depending on the coverage could cause a major impact financially. For more in-depth analysis one should meet with a experience financial professional since it is a case by case basis
5) Build Wealth
Once that is squared away it is time to build wealth particularly saving for retirement. This goes beyond just having in a regular savings account. The point is to have money growing at a decent rate therefore having enough to live on and then some. As with the previous step you should meet with a experience financial professional to get your goals established.
6) Estate Preservation
Estate Preservation is the last step of achieving financial independence. When something happens to you it is important that any final decision is made an induvial not the courts. This is done by a will. Talk to your financial professional to get an insight on how to get it established.
The next phase
These six steps are crucial to get the leash off when it comes to achieve financial freedom. At first glance the startup seems tough because hey most of us aren’t planners and life happens however the key thing to remember is to take one step at a time. Start with small goals and work your way up. Any action taken is one step closer to achieving the ultimate goal of money management.
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P.S. If you would like to know how you can start implementing these steps please reach out to me and we can set up a free strategy session!
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