Most people dream of attaining financial freedom but only a few turn it into reality. If you want to become financially successful, there are few actions that must be on your to-do list for sure: prioritize your debts, Seek options for additional income and part ways of friendship & business.
A famous quote on financial freedom: “A big part of financial freedom is having your heart and mind free from worry about the what-ifs of life.”
Furthermore, we share with you the 11 step finance planning guide which will pave the way towards your financial freedom. These steps can give you a ray of hope, to begin with, your journey towards attaining financial freedom.
Step 1: Have you set your financial goals? If not, then start now.
One of the essential steps in the process of attaining financial freedom is to set your financial goals. Setting your own goals depends on the things you wish to do or possess in life. Before you start listing your life goals, pen down how much you have in your bank account. This will give you a clear picture of how much you need to save more and the time to achieve those goals.
Step 2: Look for opportunities to fetch additional income
If you wish you become a self-made millionaire, then never rely on a singular source of income. Being smart is all about looking for various opportunities to fetch additional income. To fulfill the extra demands, you need to create multiple revenue streams. Jot down the alternate things you wish to do in life apart from your regular job.
Sometimes hobbies can be a source of extra income. If you are passionate about photography or painting, then look for ways to use the spare time to pursue your passion and get money as well.
Step 3: Set your budget
A budget is a key factor for becoming financially successful. You need to set a budget for everything starting from your monthly bills, shopping, entertainment etc. It will help you to manage your finances and give a clear insight of unnecessary expenses as well. You can set a monthly routine to check your dues, savings and expenses. Your budget will help to cut-off the unwanted expenses and save more money.
Step 4: Opt for automatic savings
Most people opt for automatic savings without even realizing its benefits. Auto savings option helps in stacking a fixed amount in your savings account every month. You can enroll in your employer’s retirement plan and get the benefits. Keep options of automatic withdrawal as well, if you need money for any emergency purpose.
Step 5: Make clearing your debts a priority
Debt is the biggest hurdle in your journey towards financial freedom. So, make it your first priority to clear-off debts. Debt is like cancer which grows exponentially with time and becomes your most expensive liability. Once you get your paycheck, set a rule to clear-off the debts. This will help you in becoming debt-free and clear the path towards attaining financial freedom.
Step 6: Pay off your credit card in full
If you don’t keep a track of the credit card dues, you might end up in huge trouble. Set a reminder to pay off the full amount of credit card every month, once you get your paycheck. It is better to use credit cards only in case of emergency instead opt for debit cards or cash. This will save you from paying the unwanted interest amount in case of late payment.
Step 7: Never waste time
It is well said: “Time and tides wait for none.” Try to use your time for maximum productivity. Time is an essential factor that determines success. Invest your time in setting up priorities, life goals, more saving ideas and sources of alternate income. Relaxation is equally important but utilizing time efficiently is the key to success.
Step 8: Don’t hesitate to negotiate
Most of us hesitate when it comes to negotiating for price, be it any commodity or service. You might be surprised to know that “Negotiation is an art”. If you sport it well, you can save more dollars every year. Most SME’s are open to negotiation, and it’s no harm in trying your luck when you can save more.
Step 9: Stay updated with market trends
Keep yourself updated with the changes in tax laws to get the maximum benefit. Update your investment portfolio with the market trends for news on stocks and exchanges.
Step 10: Proper maintenance, fewer expenses
Proper maintenance of commodities increases its life span; be it a car, a house or anything. This reduces the unwanted expenses that might occur due to repairing or poor maintenance.
Step 11: Health is wealth
Money is essential but health is everything. Taking care of your health can help you save more. How?
- No sick leaves
- No insurance premium
- Work till retirement & even more.
It is well said: “If money is lost, something is lost. But if health is lost, everything is lost.”
In the journey of attaining financial freedom, it is also important to balance your mental peace. Hope this 11 step guide will give you an insight of how to manage money to become financially successful.
Jenni is a personal finance blogger who loves to write & educate people about personal finance, money management and frugality. Visit here personal finance blog and share your thoughts.