Steps To Achieve Financial Freedom In 7 Years Or Less
Everyone strives to achieve financial freedom in their lives. And there are many ways through which you can achieve financial freedom. Some people say that they want to achieve financial freedom within 5 years, while others say that they want to reach this goal within 10 or 15 years. Nevertheless, most people would like to become financially free within seven years. Find out how you can become financially free in seven years in this article.
Save Money
This is the first step towards achieving financial freedom. You can achieve financial freedom sooner if you start saving money at an early age. Saving money doesn’t mean that you should live with a tight budget. Rather, save money in such a way that you can use it for future expenses.
Save 10% Of Your Income: This tip may seem weird at first. However, once you implement this strategy, you will be surprised by how much extra money you will accumulate each month. Increasing your savings rate by 10% is one of the easiest methods.
Invest Money
Once you have saved money, invest it wisely. There are many investment options available online. You can either buy shares or mutual funds. Buying shares means investing in companies, whereas buying mutual funds means investing in stocks. Before making a decision, you must understand the risks involved in both of these investments.
Pay Off Debt
Debts are the biggest hindrance in achieving financial freedom. Therefore, you need to pay off all your debts as soon as possible. Once you have paid off all your debt, you can focus on saving money and investing it in various ways.
Start A Side Hustle
A side hustle is a fantastic way to achieve financial freedom. Many people think that starting a side hustle takes a lot of time and effort. But you don’t need to go to college to start a side hustle. There are many side hustles that only require a laptop, a good internet connection, and a creative mind.
Live Below Your Means
Many people spend more than what they earn. If you fall into this category, then you must change your lifestyle. Stop living beyond your means and start living below your means. This will help you achieve financial freedom within seven years.
Build Credit Score
If you haven’t built a credit score yet, then you should do so immediately. High credit score enables you to take out loans. It shows lenders you are a reliable person who won’t default on loan payments.
Get Rid Of Bad Habits
If you want to achieve financial freedom in less than 7 years, then you must get rid of bad habits. For example, if you smoke, then you must stop smoking. Similarly, if you drink alcohol excessively, then you must quit drinking. These habits not only affect your health, but they also decrease your earning potential.
Set Goals & Track Progress
Setting financial goals and tracking progress is an effective method to achieve success. Without setting goals, we cannot measure our progress. Tracking your progress lets you know whether you are moving forward or backward.
Create An Emergency Fund
An emergency fund is very important to achieve financial freedom. When an unexpected expense occurs, having an emergency fund will enable you to cover those costs. Having an emergency fund also increases your chances of getting a better job.
Increase Your Savings Rate
You can increase your savings rate by increasing your monthly contributions. If you contribute Rs.5,000 per month towards your retirement account, then you would contribute approximately Rs.60,000 every year.
Pay Off Your Credit Card Balance
Credit cards are often used for making purchases. We use them to buy daily needs such as food, clothing, etc. Therefore, using credit cards is essential for modern life. However, many individuals carry high balances because they cannot repay their credit card bills on time. You should pay off all your outstanding credit card debt before saving for your future. Otherwise, it will be difficult to save money for your future when you have a large credit card bill to pay each month.
Own a Property with a Low Interest Loan
If you're looking for financial freedom, then owning a home is a great way to achieve it. But buying a house isn't cheap, and most people don't have enough money saved up to buy a home outright. So instead, they take out a mortgage.
Mortgages are expensive, though, and many people pay interest rates that exceed 20% per annum. This means that after just seven years, you'd be paying over $100,000 in interest alone!
Fortunately, there's a better option than taking out a traditional mortgage. Instead, consider becoming a member of a Housing Society. These societies offer members a variety of benefits, including lower monthly payments, tax breaks, and access to cheaper properties.
Conclusion
In conclusion, I'm sure you've heard the saying "you have to spend money to make money." Well, it turns out that it's true. And if you want to achieve financial freedom in seven years or less, you have to put in the work now. Start saving today, and before long, you'll be able to retire early and live off the interest from your savings.
