Financial Freedom often is construed as having enough savings, investments and cash to enjoy the best things in life. Financial independence is the foremost goal everyone aims ay irrespective of the sex, creed and nationality.
If there is enough income to pay for living expenses for the rest of your life, even if unemployed then life is set apart from other depend on abilities. People who get to retire early can allow themselves to explore and enjoy their dreams and passions.
- Financial Freedom must be attained and with the right habits, you can easily get there, how? Let’s take a look at some of the habits which help attain financial freedom.
- Managing money is an art, learnt at an early age is called mastering the art. This is the sole reason one must attend interactive sessions on wealth generation.
Time to understand Financial Freedom & Set clear financial goals
It is primarily important to set clear financial goals to attain financial freedom. This could be retirement at 35, 45 and even at 55 years.
Besides earning variable incomes, one will have to save and invest to attain financial goals. Assign a time-frame to achieve financial goals. If a financial freedom goal is to buy a house or go on a World tour, set a timeline within which you want to achieve the goal.
Tighten the pocket expenses
You can never achieve financial freedom without being disciplined with spending habits. You get an idea on overspending only when you track the daily expenses. This is an underrated exercise, but extremely useful.
Start investing right from the first salary of the first job. As monotonous as it sounds, this is a great way to retire rich and enjoy financial freedom. Save at least 20% of monthly income and invest based on risk profile.
Invest in equity-like equity mutual funds or shares if you want higher returns. You must be willing to bear risk in investment. Follow the 100 – age rule, where if you are 30 years, you invest 100-30 = 70% inequities.
If you are a conservative investor, invest in PPF, Fixed Deposits, NSC or Post Office Schemes. You get returns in the range of 7-8% a year. Take a look at tenure before investing. PPF has a lock-in of 15 years and NSC a lock-in of 5 years. So, invest now to attain financial freedom.
Keep Learning, the more the better!
Well, this is a given to achieve financial freedom, solely and intentionally. You must keep learning and upgrade yourself to reach financial goals. Make learning a daily goal.
If you are in the engineering or any field, strive to make it to the top of your field. Learning is really easy today with the widespread use of internet real-time learning channels.
You can learn from tutorial videos on YouTube and there are plenty of blogs which update you on the latest topics on personal finance. Learning teaches you that wealth is not the result of an act, but the result of habits.
Get rid of credit card dues
Let the initial amount of your income subject itself to the dues of credit cards, loans and other debts if any. These can sack your money like a leach in water even if the pending is due by the least amount.
Pay your credit card dues in full each month. Don’t fall short for the minimum amount due to trick. Paying the minimum amount due, means you get away by paying only a portion of the outstanding balance on credit card.
If you pay only a part of the dues, well they accumulate. You land in the loan trap. Never pay minimum due on credit card, especially credit card! Pay off debts in time and stay far from the loan trap. For some people, financial freedom is not having any debts.
Take care of your health
Health can cost if there is not much attention given to it. Well, this is a great habit to achieve financial freedom. Ill-health can cost real heavy amount these days, the disease will be constant compassion.
We are never rich if all our money goes to the doctors, treatments and medications. Most Indians spend on health out of pocket. Do take a good coverage of a health insurance plan.
This typically helps and protects you from heavy hospitalization expenses, if in case of emergencies too. This could be a path to financial freedom.