7 Steps to Financial Freedom

By Jax Cooper

7 Basic Steps Towards a Financially Free Life - This book will take you through 7 key steps to become "financially free." Whether your goal is to invest, save more, leave your 9-5 job, or prepare for the future - this short book will prepare you for all of your financial goals. 

• Language: English
• Publisher: Jax Cooper
• Release date: Mar 12, 2021
• ISBN: 9781393588092

Book preview

Attaining Financial Freedom

Danielsson (2021) describes financial freedom as having adequate resources in the form of investments and money to purvey the lifestyle you desire for yourself and your family. This affords you the luxury of retiring because you see it fitting you rather than being forced by age. Even like pursuing a career without being controlled by the financial reward but by the joy and satisfaction derived from it. This definition of financial freedom resonates well with everybody’s desires regarding their financial well-being, but there is a divide between desires and reality. This gap is partly due to lack of knowledge and mainly due to inaction, which defies the mantra, knowledge is power. This new phenomenon views knowledge as mere potential and acting in response to that knowledge as real power (Robbins, n.d.). No wonder we have many talkers and only a handful of actors in sync with their talk. Thus, to transform from talking to action, some tips will help realize this reality.

Having a Financial Freedom Vision Board

A financial vision board motivates you through clarity, which is a prerequisite for concentration and maintaining focused on goals. The collection of images, words, numbers, and dates relating to specific goals is vital for developing healthier financial habits, staying on course, and achieving milestones.

Setting Specific Goals

Setting specific goals help to provide clear targets necessary to stimulate your inner energy when faced with challenges. For instance, when setting saving goals, state the exact goal, such as a deposit for a home or car, making saving enjoyable and meaningful. Also, specify the amount to save, the debt that you need to pay off, and be specific with timelines.

Have a Spending Mantra

Having a unique spending mantra to you will help harness your spending habits if you are about to be wayward. Examples of these mantras include the following: Spending after saving; is based on Warren Buffett’s saving equation: Income - Savings = Expenses.

This mantra can be achieved if you put a debit order that transfers money to a savings account as soon as your salary reflects in your account. Other mantras are waiting before you splurge and charge yourself a luxury tax.

Self-Respect entails taking care of your financials as a way of respecting yourself and your well-being.

Rewarding Yourself

This implies giving yourself a treat after reaching a saving milestone. This reward will act as bait that propels you to do more savings.

Creating a Budget

This is a way of being accurate in managing your money. Inflows and outflows of money will become easy to recognize. It is the best way to control your finances as it creates accountability and responsibility.

Using Plastic Money

In debit and credit cards, you spend more on each transaction than when using cash, where you think twice before making any purchase.

Reflecting Daily on Your Finances

This helps you to scrutinize financial transactions. You become aware of challenges as they arise and help you keep track of your financial progression. If done in the morning, it sets a spending tone for the rest of the day. Quick adjustments to your spending habits become easy and possible.

Financial Priorities

This takes a specific portion of your salary, for example, 20% channeled toward long-term savings. This must be a fixed amount and not fluctuating monthly.

Setting Aside a Portion for Entertainment

This will help promote the saving mood as you will participate in things you enjoy. Striking a balance between savings and entertainment will help you save more money.

Net Worth

Constantly calculating your net worth, which is the difference between assets and liabilities, helps you establish your financial standing. This enables you to summarize your entire economic life, track your progression toward financial goals, and inform you whether you are skewed toward spending or saving. You can take corrective actions before it’s too late.

Leveraging Financial Tools

Keeping savings in a separate account with the highest interest rate does not only ensure the safety of your savings. Still, it provides an opportunity to create passive income from your money.

Investing

By investing now, you create a better opportunity to grow your money in a way that surpasses any available options.

Continuously Educating

By educating yourself and reviewing tax laws, it helps you to exploit necessary financial adjustments and deductions fully. Keeping abreast with financial news and stock market trends is vital for adjusting your investment portfolios. This knowledge will help protect you and your investments from financial predators.

Assets

Continually maintaining your assets such as cars and lawnmowers is cheaper than replacing them while making them last longer. Somebody should not undermine the importance of living below your means, seeking financial advice, and taking care of your health as well.

Chapter 1: Gainful Employment

Many people associate financial freedom with quitting your job, doing some miracles in the business world, and making millions of dollars. Is it a rule of thumb that you must only be in business or be a millionaire to have financial freedom? The answer is an outright no.

Many people manage to be financially free even when they are in their usual jobs. On the other hand, we have some businesspeople who never experienced financial freedom and in the worst-case scenarios, broke millionaire lists are getting longer by the day. Gaining financial freedom encompasses a lot of things besides having access to millions of dollars. This entails personal dedication, proper planning, sacrifice, and