Throughout history freedom and independence has almost always come about through struggle. And even though this fight for “financial freedom” isn’t a struggle of flesh and blood, it’s, none-the-less, a really real struggle that demands strategies, discipline, and sacrifice.
So just what’s Financial Freedom, and can it be worth fighting for?
First off, asking if financial freedom is worth fighting for is similar to asking if satisfaction is a desired state. Needless to say it’s! So just what’s it? Can it be the financial place what your location is free of all financial responsibilities… ? Or the amount of money position where you have all you’ll ever need? No it’s not too at all. In reality “responsibility” may be the core of this freedom.
So, for our purposes, financial freedom is a financial mindset and monetary position where money worries are at a minimum comment avoir la liberté financière, and ease of buying what you need and need is easily and responsibly accomplished. Most importantly this means having income enough to sustain the specified lifestyle. This occurs when the income from your entire assets exceeds your expenses.
It also means that for some people, regardless of how much money they have, they will never attain financial freedom because they don’t really have the desire or the discipline to acquire it. A person earning $100,000 annually and spending $110,000 is in a much worse financial situation when compared to a person earning $75,000 and spending $70,000. One core principle of financial freedom is to pay a maximum of you have coming in… and preferable less. Complacency, and surrender to the “wants” significantly more than to the “needs” are hallmarks of the financially oppressed.
So how will you win the battle for financial freedom?
Generally in most battles, be it chess, video games, life, or actual war; victory takes planning and implementation. In chess you might give up a knight to trap a queen… or in war, exercise a proper retreat to be able to win the war. So it is also in this battle for financial freedom. For many of us to be successful in this endeavor, it will become necessary to sacrifice a number of our immediate wants and desires to be able to reach the stated financial goal.
You will find three major components to the battle:
The very first is strategy… or having a plan. Debt free (how to become), post debt free plan… You should responsibly manage what 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 your income to that use, and with what’s left create a plan of attack for eliminating all credit debt.
Start with gathering and listing all credit debt… credit cards… department store accounts… any reoccurring monthly debt. Examine the accounts and list them in accordance with interest rates. Choose one of the top interest rate accounts as the main one to attack first. Make minimum payments on all of the debts except the main one you have chosen, then put all available funds toward eliminating that debt.
When the initial debt is eliminated, choose the next debt to get rid of and put all available funds until it too is eliminated. Continue this technique and soon you eliminate all of your debts. It may seem slow in the beginning, but you can see the snowball effect that this can create… the last bills is going to be eliminated pretty quickly
A Very Real Caution
As you begin to get rid of your debt, don’t fall back into the trap that got you in this fix. That’s, don’t genuinely believe that since there isn’t any debt you can venture out and get that “whatever” you’ve been wanting. Now you have only succeeded in winning the initial battle for financial independence. The war is currently where over… STICK TO THE PLAN!
So, when your entire credit debt is fully gone, the amount of money you were using to cover them is available these days for sensible investing… which will be the main next step.
Hopefully, in accomplishing the elimination of your credit debt, and not succumbing to the temptation to pay, you have made the psychological changes necessary to initiate the next phase… This change in attitude will enable you to truly achieve the battle for financial freedom. Begin to construct wealth by doing two things… first by continuing to tap into your new found discipline, spend less that you have coming in and make some low risk, longterm investments.