How to Accurately Achieve Financial Freedom How to Accurately Achieve Financial Freedom, Financial independence, or financial freedom, is frequently discussed since it is many people’s desire.

But what exactly does this mean? Essentially, financial freedom is a state in which we may make numerous expenditure decisions without being concerned about our financial circumstances.

Financial freedom is not simple to acquire, especially if it is not accompanied by thorough preparation and planning, as well as a modest lifestyle. It requires dedication and discipline to manage cash from a young age. We must also be more frugal with our money.

Unfortunately, in our productive era, there are numerous Wants and Needs that we must meet in order to survive, which impacts our financial discipline.

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What Can We Do to Improve Our Financial Discipline?

First, we must comprehend our financial situation. Essentially, financial independence is evaluated not by how much we make, but by how much that income can cover all of our wants and desires without interfering with our savings.

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Second, re-calculate our income and spending every day, week, month, and even year. If there is an imbalance, then the income and expenditure must be adjusted. We may also work around this by seeking for part-time job, starting a small business, or becoming a Life Planner.

Third, reconsider what inspires us to be more disciplined in our financial management. The reason for this is that high discipline might begin with motivation or ambitions to be achieved.

After we grasp these three concepts, we can begin taking further actions to help us be more disciplined in our financial management, such as having insurance as a safety net and investing as a method of creating money in order to reach financial independence in the future.

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How to Achieve Financial Independence?

There are numerous approaches that may be taken to achieve financial freedom, as listed below.

  1. Outline Our Objectives

To make achieving financial independence simpler, begin by narrowing down the main aspects associated to this, such as the nominal amount we desire in a bank account, how to change our existing lifestyle to obtain that nominal, and when it must be achieved.

  1. Make a spending plan.

Making a budget plan, whether daily, weekly, monthly, or annual, allows us to better organize and manage our finances. It is also one of the most effective strategies to assess our financial situation. Is our revenue equal to our costs, or do we still need to make changes?

We might try to categorize each cost that will be allocated to ease budget planning. Furthermore, it is critical to discern between our requirements and desires in order to keep our financial situation constant. Needs are items that we require in order to live our daily lives.

Desires, on the other hand, are subjective objects tied to our tastes, and their fulfillment might be delayed. Put needs-related costs at the top of our priority list to prevent spending that is less beneficial and may affect us in the future.

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  1. Begin Living a Simple Life

Living simply does not involve being stingy with yourself or others around you, but we must be prudent in our financial management by spending in moderation. As a result, we can put more money into savings accounts.

  1. Pay off your debts and credit cards

If you have debt or credit, both to family and credit card debt, it is preferable to repay it as quickly as possible. Set aside a portion of your monthly income for repayment.

Reduce your usage of credit cards as much as possible to prevent amassing debt.

  1. Cancel any unused subscriptions

Although the sum is little, withdrawing funds from our bank account for subscriptions we seldom use would be damaging. Stop it if we don’t utilize it so that the subscription budget may be used for other things.

  1. Make an investment

Given the probability of inflation, the money we have now will not be worth the same in five years.

However, if we invest the money, the value and nominal will increase. Especially now, when there are so many investment possibilities, such as stocks, mutual funds, gold, and real estate. We just need to study more and select an investment instrument over which we have the most influence.

In addition to the six previously mentioned strategies, we may attain financial freedom by optimizing protection through insurance programs.

One of them is health insurance, which protects against the possibility of sickness, which can hit at any time. We can utilize Manulife Indonesia’s MiUltimate HealthCare (MiUHC) as an alternative to assure financial freedom in the future.

Not only does it give benefits for reimbursement of hospital bills, but it also provides benefits for accommodation fees overseas, additional yearly limitations for serious diseases, and bill payment of benefits. When we are unwell, we may concentrate on the healing process rather than our financial situation.

Author: Irawan
I'm a regular contributor to IRAWAN commander, and in my business blog, my team and I share tales on the experience of starting a business from zero, how it feels to build a startup, and how to scale-up.

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