It's easy to feel like you are imprisoned by your finances. There never seems to be enough. But it doesn't have to be this way, if you can achieve financial freedom.
What is Financial Freedom?
Total financial freedom is enough money to do whatever you want with your life. Whatever it takes to stop worrying if you are going to have enough to cover your expenses each month. With financial freedom you can focus instead on savings goals like buying a home, a car, paying for children's education, or financing your hobby.
The Tough Road Ahead
There is no easy solution. Achieving financial freedom requires dedication, willpower, planning and above all, patience. You may need to start working on it today if you want to be financially comfortable when you retire. But your financial dreams are achievable. Take control of your destiny by adhering to the following advice.
Budgeting to Save
While everyone knows they'd have more money if they saved more, it is challenging to put into practise. It's tempting to spend money on making your life more comfortable when you are living off beans in a home needing repairs, putting on a second jumper to stay warm, or walking home in the rain watching taxis pass you by. But in the long run, there are better rewards for saving money. You will earn off interest, rather than paying it on debts, and you can build towards an early retirement, where you can live easy or make your hobby full-time.
Personal Finance Assistant
Money Dashboard is a personal finance assistant that anyone can use as a budget planner. It will keep track of your spending, and automatically sort each transaction into categories, so you will easily be able to compare your budget to your spending, and clearly see when you are reaching or passing your budgeted limits.
Using Money Dashboard, keep a record of everything you spend money on in 30 days. You might be surprised to see where your money goes. This list can form the basis of your monthly budget. Reduce the spending in areas where you feel like you spent too much, and only increase an amount if you spent less than normal.
Once you have built up enough savings to form a financial cushion, you can start thinking about investing your savings. Investing in property is usually a prosperous endeavour in the UK. If you are renting out a property, there are agencies that can deal with all the legal paperwork, listing, tenants, repairs, etc. on your behalf. However, the more service you pay for, the less you will make from the property.
If you can make time in your life to deal with it, the best landlords are those that communicate with their tenants regularly, and respond to repair requests promptly. It may seem more expensive, but happy tenants will stay for longer, and the administrative and incidental costs of changing tenants is not worth the savings on improvements.
You can also speak to any bank, building society, or pension firm about options for investing your savings. Pay attention to interest rates, risk or liability, liquidity (in case you need to turn the investment back to cash), associated fees and expenses.
Work out the best return on investment at a level of risk you are comfortable with. If you find all the information confusing or overwhelming, a decent Independent Financial Advisor might be able to suggest ways to invest your money that will make you enough in revenue to cover their costs.
Although it may take time, it's possible to achieve financial freedom by saving and investing. Keep your eye on the ball and remember that work today will pay off with interest in the future.