The Covid-19 pandemic has put strain on the global economy. America is no exception. In times like these when it is difficult to make a living, it may seem impossible to attain financial freedom. It is possible to reach the light at the end of the tunnel by putting the right principles or values in place.
What exactly is financial freedom? The aspiration to be financially free means that you will be able to make life decisions without overly worrying about the financial consequences. It means that you are in control of your finances rather than being controlled by them. It is important to realise that financial freedom does not mean that you are “free” from the responsibility of managing your money. It simply means that you are aware of uncertainties and take responsibility for your income and expenses while making sure that they aren’t overwhelming when they occur.
Additionally, it’s important to remember that achieving financial freedom in America isn’t determined by your income – anyone can achieve it if they follow these steps:
Set specific financial goals:
Defining what financial freedom means to you clearly is the first step. Avoiding the rat race begins with your answer to this question. Answering it will help you determine when you are truly financially free. Put yourself in the shoes of a person who is financially free and note the characteristics of such a person’s finances.
Save up money in different chunks:
Being open to saving up money in different chunks helps you know what money will be used for what, what money can be touched and what money should not be spent. A part of this chunk should be money you are setting aside for investment purposes.
Have an investment plan:
Investments are essentially allocations of resources, usually money, with the intention of making a profit. Here are a few steps to get started:
- Make a budget and start putting money aside.
- Set a goal for your money.
- Pick an investment account.
- Open your account.
- Choose investments that match your tolerance for risk.
Build your money management habits:
Being financially free doesn’t just fall on anyone. It is a product of discipline and intentional money management habits built over time. In order to become financially free in America, build daily positive money habits.
Do not be an impulsive spender.
Save money consistently and intentionally.
Live on a budget
Do not be quick to acquire debts
Little drops of water, they say, makes a mighty ocean. Start today and build these habits over time
Put some effort into your health:
Ever heard the saying “Health is Wealth”? Well, that’s totally true. You can only be as wealthy as your health allows you to be. So, take good care of your health so that you don’t spend your life savings on medication and hospital bills. Exercise frequently, drink water often, and get enough sleep. All these are ways by which one can stay healthy.
Get out of debt by avoiding more debt
If you ever want to get out of debt? You have to intentionally pay up a certain percentage of your debt monthly and while at it, avoid more debt as much as possible. According to Metro Bank, a few ways to avoid unnecessary debt is by being disciplined enough not to apply for a credit card. If you can do without a credit card, then do. A second way is by living within your means – prioritising your needs before your wants and a third way is by keeping a strict budget.
Actually Begin to invest
Many people gather so much money and do not invest it, especially because they fear losing money in the event that investments are lowered. Despite your best efforts, you may never be able to save up enough money to appear financially free. Additionally, saving money to realise financial independence will take years. Investing gives you the opportunity to grow wealth easier than saving money. Get rid of your fears and try investing. It’s better to start early so you can reap the rewards sooner.