You've worked hard and hustled your whole life. You have a career that allows you to make ends meet. However, you still yearn for true financial freedom and want to find a way to achieve the independence you've always dreamed of.
Breaking free of financial shackles takes serious work and careful money management. Thankfully, the suggestions below are flexible. Take advantage of them, and eventually they’ll provide you with the financial capability to change your life for the better.
1. Master the Art of the Budget
Before you start doing any real heavy-duty saving, create a budget that takes into account all your regular expenses while still reserving a little extra money every month. This process can be tough, as it requires you to do some serious assessment of your spending habits.
Making a budget — and sticking to it — can be tough. Nearly everyone who does it, though, finds the sacrifice worth it. Knowing where your money comes from and where it goes is deeply satisfying, as is the security of building up a financial cushion for the future.
2. Create an Emergency Fund
The next important step is to create an emergency fund. Emergencies blow through your bank account almost no time, but building up your balance again afterward can take forever.
Experts recommend that you save an amount equal to six months’ worth of expenses for your emergency fund. The next time something big goes wrong, you'll be glad you did.
3. Focus On Reducing Debt
While saving is imperative, you also should make sure you’re “plugging the drain” by paying off any debt that you owe. There are several techniques available to help with this:
Always paying more than the minimum payment amount on your bills
Using debt consolidation, if necessary, to shrink your payments and make paying off multiple debts a more attainable goal
Investing your tax refund into your debt relief efforts
4. Expand Your Finances
Too many people try to get by with one source of income and find they can't survive on it. This is a frustrating reality, but it’s not insurmountable. Many methods are available to help expand your income sources, boost your savings, and increase your financial freedom:
Opening a 401(k), Investing in stocks, bonds, real estate, or Setting up a side hustle that brings you more money
5. Stop Limiting Yourself
People often suffer from the delusion that they’re limited in some way, or can't earn the success others have obtained. This mistaken concept can frustrate you and keep your self-esteem low. It’s also untrue. Look around for some inspiration to help you stop limiting yourself and start thinking big. If you put your mind to it, there isn't anything you can't do in this life.
Fiscal limitations can leave you feeling hemmed in, it’s true — but there are lots of strategies to help turn a bad fiscal situation around. Many techniques of smart budgeting, debt management, diversifying sources of revenue, and strategic saving will offer you once-in-a-lifetime experiences while also helping you fund your future financial freedom.
Contribution By Molly Barnes, Digital Nomad Life