Financial freedom is directly related to our economic well-being, to the balance of our finances and to successful businesses. But how to achieve all that? Is there a magic formula? If you want to get financial freedom, this is the essential guide for you.
What is financial freedom?
The concept of Financial Freedom is when you have the option to stop working and pay the expenses regardless of the lifestyle you take. According to the concept, it is possible not to work, to have money and at the same time to pay the expenses of every day.
That’s right, having financial freedom can choose to work or not. Not as it usually happens that the only way left is to have a job that allows a decent life. In any case, you can also work even when there is the option of no longer do so.
To a significant part, financial freedom is obtained when you do things for pleasure and not for obligation. That is, people can work on what they like most and not be in a job that they dislike, but that has a good pay.
Those who seek to reach this point are those who want to enjoy more of their time and recreational activities or to help them to have better training.
In theory, achieving that status is possible, it’s not just for rich or lucky people who win lottery raffles.
Several ways can lead a person to achieve financial freedom, for some is to set up their own business, others to save money to retire at age 30, or also, there are those who take good care of their money and live without debts.
But for each person the solution is different.
How to get financial freedom?
So if your motivation to acquire money, success and prosperity come from an unproductive source, such as fear, anger or the need to prove what you are worth, money will never bring you happiness, and you will have a mind conditioned to lack.
There is a process that you will have to follow carefully to get financial freedom. It is essential for you to be successful financially.
How do you achieve financial independence?
This process consists of 5 steps that are essential:
1. Reduce the size of its expenses:
Reduce unnecessary expenses. Avoid spending on needs that are not important at this time, stop them. To increase your income, you must first make the proper management of what you already have and in the best way. Start a budget proposal and commit yourself to it strictly. Get rid of all unnecessary debts. Sell your car that makes you spend too much and buy another less consumable.
2. Increase your financial IQ:
Inquire about money and how it actually works. This type of education is not taught in schools. Go to the library and bookstores and then find books that are dedicated to strengthening wealth and prosperity principles (such as Think and Grow Rich, The Secrets of a Millionaire Mind, Rich Father, Poor Father, Increase Your Intelligence Financial, etc.). Once you get a better understanding of how money actually works, you will make more educated decisions as do the wealthy. The increase in your financial IQ will get you the most, Money that you will be able to retain and even grow. Learn your money to work hard for you.
3. Increase your income:
Now that you have cut all unnecessary and unimportant expenses and you have the financial education gained, it is time to increase your income. Work a few extra hours or find another part-time job. This process will add another source of income to your household. Save this extra income and put it in a case called new business. This will prepare you for the next step.
4. Use a Leverage Effect:
Use force to put a turbo on your income. The passive income is the income you earn will stop without your direct and constant supervision. Your primary income will be used to pay your living expenses and expenses related to your household. Your part-time extra income can be used to invest in a business that will give you a passive income. Examples of passive income: Stocks, bonds, annuities, network marketing income, real estate investment, etc.
5. Have a Plan of Action:
You must incorporate the above steps into a realistic action plan. And be professional in establishing self-discipline for yourself. This plan must be dated and signed by you and if possible by your spouse. Most people fail because they do not have a real plan and do not have the discipline to follow up on a decision.
The 5 steps listed above are the basics you need to adhere to go to financial freedom. However, these steps are simple and clear, they are recognized by the most fortunate men in the world. So simplify things and things will be simpler for you.