Throughout history freedom and independence has typically come about through struggle. And although this fight for “financial freedom” is not challenging of flesh and blood, it’s, none-the-less, an extremely real struggle that demands strategies, discipline, and sacrifice.
So just what’s Financial Freedom, and can it be worth fighting for?
To start, asking if financial freedom may be worth fighting for is much like asking if reassurance is an ideal state. Of course it’s! So just what’s it? Could it be the financial place where you are clear of all financial responsibilities… ? Or the cash position where you’ve all you’ll ever need? No it’s not too at all. In reality “responsibility” is the core of the freedom.
So, for our purposes, financial freedom is an economic mindset and monetary position where money worries are at a minimum, and ease of purchasing what you need and need is easily and responsibly accomplished. Above all it means having income enough to sustain the desired lifestyle. This occurs when the income from your entire assets exceeds your expenses.
It also means that for a few people, regardless of how much money they’ve, they will never attain financial freedom because they do not have the desire or the discipline to acquire it. An individual earning $100,000 annually and spending $110,000 is in a much worse financial situation than the usual person earning $75,000 and spending $70,000. One core principle of financial freedom is to invest no more than you’ve coming in… and preferable less. Complacency, and surrender to the “wants” more than to the “needs” are hallmarks of the financially oppressed.
So how will you win the battle for financial freedom?
In many battles, be it chess, video games, life, or actual war; victory takes planning and implementation. In chess you might quit a knight to trap a queen… or in war, exercise a proper retreat in order to win the war. So it is also in this battle for financial freedom comment prendre sa retraite anticipée. For the majority of us to be successful in this endeavor, it will end up required to sacrifice a few of our immediate wants and desires in order to reach the stated financial goal.
There are three major components to this battle:
The first is strategy… or creating a plan. Debt free (how to become), post debt free plan… You must responsibly manage everything you already have. Remember the big three: planning, dedication and discipline!
List all income and expenditures. Honestly determine what’s necessary for the absolute essentials… commit that amount of one’s income to that use, and with what’s left create an agenda of attack for eliminating all credit debt.
Start by gathering and listing all credit debt… credit cards… department store accounts… any reoccurring monthly debt. Examine the accounts and list them according to interest rates. Choose one of the top interest rate accounts as the one to attack first. Make minimum payments on all of the debts except the one you’ve chosen, then put all available funds toward eliminating that debt.
When the very first debt is eliminated, choose the following debt to remove and put all available funds until it too is eliminated. Continue this process until you eliminate all your debts. It might seem slow initially, but you can see the snowball effect that this can create… the final bills is going to be eliminated pretty quickly
A Very Real Caution
As you begin to remove your debt, don’t fall back into the trap that got you in this fix. That is, don’t believe given that there isn’t any debt you are able to head out and get that “whatever” you’ve been wanting. Now you’ve only succeeded in winning the very first battle for financial independence. The war is currently where over… STICK TO THE PLAN!
So, when your entire credit debt is finished, the cash you had been using to cover them is now available for sensible investing… which is part of the next step.
Hopefully, in accomplishing the elimination of one’s credit debt, and not succumbing to the temptation to invest, you’ve made the psychological changes required to initiate the following phase… This change in attitude will enable you to truly flourish in the battle for financial freedom. Begin to create wealth by doing two things… first by continuing to tap into your brand-new found discipline, spend less that you’ve arriving and make some low risk, long term investments.