Ask anyone what their life goals are, and financial freedom will probably be at the top of that list—and for good reason. Financial freedom, for many, isn’t just about the money. It unlocks a world where we have time to do the things we love. This can be as simple as spending time with our family or maybe traveling the world, without the burden and stress of living paycheck to paycheck.
10 Steps to Achieving Financial Freedom
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Taking steps towards true financial freedom doesn’t have to be hard. Here are the top 10 steps you can follow today to get where you want to be and ditch that 9-5 for good.
1. Look At Where You’re At
The hardest part of doing anything is taking that first step, and that is especially true here. We know how daunting it feels to have to sit down and look your finances right in the eye—especially when you have debts to pay off and are still living paycheck to paycheck. But, the first step to financial freedom is to know exactly where you’re starting from.
Make a list of all the money you’ve got coming in, as well as a list of all the credit card debt, student loan debt, or medical debt that you have to pay off. From there, you can develop a budget plan that works for your current situation.
2. Create a Budget Plan
Once you have a clear idea of how much money you’re bringing in and how much money goes to fixed expenses every month, you’re ready to make a budget plan that you can stick to. Your budget plan should include fixed expenses, a plan for savings, and any debts you need to pay off.
If the thought of a budget plan scares you, don’t worry, you don’t have to give up the things that add value to your life. So if your morning Starbucks run, or weekly yoga class keeps you sane, work those into your budget, so you don’t have to feel deprived.
3. List Your Goals
Once you have a clear idea of how much money you’re spending and bringing in each month, you can make a list of the financial goals you want to achieve in the coming year. No matter how big it is, write it down and break it off into smaller goals that you can accomplish month to month. Having a clear destination is a great way to remind you what you’re working for when you have days where you feel overwhelmed or stressed.
4. Track Your Spending & Pay Off Debts
Paying off debts should be a top priority because they are an investment in your financial freedom. It’s hard to generate income when you’re paying off debts, but they are a necessary part of gaining true financial independence. To keep yourself on track, make sure you are tracking your daily expenses and sticking with your budget every month. Plus, the profound sense of relief you get from paying off your debt is well worth the effort you put into doing it. Motivate yourself by keeping a book such as Good Debt Versus Bad Debt and read it anytime you feel that you are getting off track.
5. Making Money vs. Building Wealth
Are you just making money, or are you actively trying to build wealth? When you’re making money, you’re working a 9-5 while getting a fixed income every month with little opportunity for regular growth. Whereas, when you’re building wealth, you have the power to generate more income and grow regularly.
If you want to achieve financial freedom, you must shift from the mindset of just making money to get through the month. Instead, focus all of your efforts on building your wealth, whether that be through investing, a side hustle, or creating your own business.
6. Make Time Work for You
We all wish we had more time in the day, and the reality is, we don’t. But, don’t let time work against you. Adopting productive habits to make the most out of every day is the best way to keep yourself on track to achieving your goals.
Whether that’s making time for the business you want to start or investing in a side hustle, building productive habits now will help you make the most of your time in the long run.
7. Change Your Mindset
The only person standing in the way of your financial freedom is you and the beliefs you feed yourself every day. If you bounce back and forth from workdays to relax mode, you need to change that. No matter how you decide to start building wealth, it will take time—and time is scarce.
Next, try thinking of money in a more positive way. Identifying what beliefs you hold about money can help you get into a mindset more closely aligned with your goals towards financial freedom.
8. Spend Less, Consume More
The trick to gaining more financial freedom just about prioritizing where you spend your free time—it’s about prioritizing your spending as well. The old adage that “you have to spend money to make money” holds ground here and plays a huge role in how successful your efforts will be overall.
Rather than spending $50 on a new pair of shoes when you already have a closet full, invest that $50 in online courses or resources that will provide value towards your goals. Make sure every purchase is an investment in your financially free future.
9. Create Additional Sources of Income
This is obviously a very key step. It’s the step that really makes the difference. One of the greatest things you can do to give yourself financial freedom is to generate multiple streams of income. For you, that might mean investing in real estate, building a side hustle, or getting into affiliate marketing. Make a list of all of your skill sets, because virtually any skill that you have can become profitable.
10. Commit 100% to Your Financial Freedom
If you are serious about gaining true financial freedom and find yourself stuck in a 9-5, you will need to commit to spending those spare hours productively. Give up Netflix, or the weekend golf game, and stay focused on your short and long-term goals.
What Are You Waiting For?
The truth is, anyone can achieve financial freedom no matter what their current income accumulated debt. The trick is proper time and money management—and hustle. If it was too easy, everyone would be doing it. What are you waiting for? Start taking steps toward your financial freedom today.