Define financial freedom by yourself.
Financial freedom is not all about being rich and having tons of money but having enough to cover your expenses so that you can spend your precious time doing what you like rather than just doing things to earn money.
You might be having the biggest dreams in life such as traveling the world and gaining experience on incredible adventures and the only way to achieve these goals while remaining in a good place money-wise, you need to establish financial freedom. So financial freedom is being able to take that amazing trip without worrying about not coming into the office, it’s buying the house your family dreams of and still having the funds to pursue your other interests, it’s connecting to your deepest values without having to worry about paying the bills.
Have financial literacy
Don’t let the fear of jumping into the financial world or a sense that you’re just not good with money prevent you from improving your financial knowledge. Financial literacy is the confident understanding of concepts like saving and investing that leads to an overall sense of financial well-being and self trust. Its goal is to establish a feeling of control over your finances while also using money as a tool to freely make choices that build greater life satisfaction. Someone who’s financial literate has a better chance of handling the inevitable ups and downs of their financial lives by understanding how to prevent and manage issues as they rise.
Make a budget.
The simplest ingredient in all recipes for budgeting is tracking i.e keeping tabs on where your money is flowing in and out is critical for staying on track with your budget. With the insights you gain from knowing where your money is going, you can make sure you’re spending in a way that aligns with your values and goals. Budget gives you control to make the decision that lead to greater happiness.
Pay off debts.
Debt is a major obstacle to reaching financial goals from everything to buying a home to retiring. Borrowing is pretty easy but paying back is hard. Sometimes it can be difficult to find the motivation to continue paying off your debts but with dedication and patience you may find that it helps to support your future financial health and well-being.
Build an emergency fund.
Preparing for emergencies is critical part of a thoughtful and comprehensive financial plan. By having sufficient funds set aside for immediate but unexpected cash needs you’ll be in a much better position to know the short term economic turbulence and market volatility while remaining on track toward your long-term goals and objectives.
Start investing early with a goal based approach.
Investing is the deployment of funds with the objective of earning returns. The fundamental reason for investing is to meet the cost of inflation i.e the sustained increase in the prices of a basket of goods and services. This will ensure that you earn a return in excess of the value by which the purchasing power is eroded.