Little Steps You Can Take Today To Achieve Financial Freedom Sooner
We can all agree that we need money to live and survive, but have you thought about not being stressed about money at all? It doesn’t mean that you stop caring about money, but you want to care enough about it right now so that in the future, you can live your life according to your terms and not worry about how to pay the bills.
Most stay-at-home moms are stressed about money. Many people are stressed about money. In fact, according to a survey of a non-profit group called Apprisen, 72% are stressed financially. But it’s never too late to dream and act for a stress-free life. Financial independence is not a myth – it’s real, and it can happen to your family also.
With financial independence, a lot of things that are necessary now can become just options later on.
You can take a vacation whenever you want, without filing a leave from your boss, because employment is no longer necessary. You can purchase the things that matter to you without racking up your credit card because getting into debt is no longer required. Suffice to say, financial independence is when money no longer dictates your life, but being able to use the money to live a meaningful life. That sounds like a good life, right?
Financial independence can seem like a tall order, but there are a couple of small steps you can take right now to pave the way towards being financially free.
1. Create a Financial Plan
If you currently don’t know where your finances stand, it’s hard to go forward. Set a meeting with your spouse and talk about your aspirations for financial independence so you can be in it together. Pull out your financial documents and figure out your net worth. This will serve as your starting point towards the path for financial freedom.
2. Create a Budget
It’s great if you already have a budget, but if it only works for your current financial situation and short-term goals, you need to work around it. Financial independence is an ongoing and long-term effort, and your budget should reflect that. From this new budget, you will know how radical you have to be in changing your finances for the better. So, create a new budget that reflects this new financial aspiration and stick to it.
3. Build a Buffer
Ask any financial expert for a solid financial foundation and an emergency buffer is likely to be there. Whether your partner works aggressively to generate more income and you try to pinch every penny to save, without an emergency fund, you’re always just one step away from financial ruin, leading you back to point zero, if not at negative. An unexpected job loss, illness or repairs can cost you your budget and savings, so be prepared for them. You can start small by saving at least $500, then increase it as you see more rooms to save and do so until you have around six months’ worth of monthly income. Don’t touch this fund unless absolutely necessary.
4. Crush Your Debts
If there’s one thing that holds you back from financial freedom, it would be your debts. In a world where debt has become such a normal component, it’s easy to think that you’re just like everyone else who has credit card bills, personal loans, mortgage, car loans and student loans to pay. However, unless you tackle these debts, most of the income will go towards paying them, thereby limiting how much you contribute to your goals.
5. Find More Ways to Save
Now that you have a solid buffer in place, you can now start saving for the particulars. Save up for your retirement, kids’ college and even some luxuries like a vacation. Saving as much as you can today is an essential component in financial freedom so that you can have the funds to use later and not have to worry where money would come from. And don’t forget, every little thing that you can save will compound to something huge later on, so start spotting more potential ways to save at home today.
6. Find More Ways to Invest
You shouldn’t limit yourself to just saving because your funds will soon run out, even if you live frugally. You also need to invest, so that when the breadwinner decides to retire, your investment profits will keep you afloat. But do consider though that all investments have inherent risks, and it’s best to consult with a financial expert to guide you on the best investments based on your financial capacity and goals.
7. Increase Your Income
There are many different ways to help increase the household income even if you’re a stay-at-home mom. You can earn from your passion (crafts, cooking, consultancy etc.) or establish a business you can run from home. There are also hundreds of ways to earn online which help supplement your income and help your family achieve financial independence sooner.
Financial independence should be a shared family goal and needs to be openly communicated in the household. This way, every member who is old enough to understand can do his or her fair share, even with little things like switching off the lights and water that are not in use to reduce utility costs. Every huge dream begins with a single small step, and you play a crucial role in directing your family towards this goal.
Never doubt for a moment about your family being financially-free! You can there too and we’re here to help you. Talk to us now about our FREE financial coaching services to get you all set-up and equipped towards financial freedom.