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Financial freedom is not just a dream but a real attainable goal. In today’s fast-paced life, where you’re working hard but seeing it all go to expenses and bills, financial freedom can seem impossible. All it takes are a few targeted steps in the right direction for you to start enjoying the fruits of your hard work.
And so, to help you hit the accelerator on your journey to financial freedom, we’ve curated a quick and easy roadmap. Here, we give you five steps to unlocking your financial freedom and getting closer to your goals.
The first step to financial freedom is understanding your present situation. This requires you to take a close look at your current financial status. To do this, study your accumulated savings, monthly expenses, income & financial obligations
You have to essentially create a personal financial statement as companies do. Make a list of your assets and liabilities and their worth. Through this exercise, you’ll be able to accurately ascertain your present financial situation. Once this is done, it’s time to plan your financial objectives.
The next step is to specify your financial goals and plans for the future. This is apart from wanting to attain financial freedom. These goals would usually include saving up for a family trip, a new car, a new house, a wedding or other such big-ticket expenses.
The benefits of setting financial goals are two-fold. Firstly, they allow you to plan and set aside your savings for these goals. Secondly, they motivate you to spend less and save more, thus allowing you to streamline your expenses considerably.
It's important to know where your money is going. You might have a rough idea about your monthly expenditure such as water bill, electricity bill, household expenditure, loan repayment, etc. In order to become financially free one day, you need to gain an accurate understanding of what you’re spending on.
The idea behind this is to learn whether you can reduce your expenditure and increase your savings instead.
A single source of income is not enough. In order to become financially free one day, you need to establish multiple sources of income today. And this is easier than it seems. All you need to do is set up passive income streams.
To do this, identify opportunities where you can trade your time in exchange for money. Examples of this include teaching a skill such as playing an instrument, baking or even public speaking.
Another way to build income streams is to invest. This is one of the most common ways of growing your money. You can invest in the stock market by way of mutual funds and equity. Apart from this, you can also invest in real estate and rent out the property to gain a steady monthly income. This way, you can increase your savings and get a step closer to financial freedom.
We never know what the future might hold. And while this is true, we can always prepare for emergencies or unexpected events beforehand. Apart from saving a portion of your earnings every month, maintain an emergency fund as well.
This safety net will ensure you don’t need to turn to your near and dear ones at a time of financial constraint. What’s more, you can always dissolve a portion of this fund in the future and put it towards stocks, real estate or other investment vehicles to keep it growing.
Financial freedom might seem like a distant dream today, but by following the above five steps, you can get closer to it one day at a time. All you have to do is keep an eye on the bottom line while working towards your future, and soon you’ll be financially comfortable.
While these five steps are crucial to attaining financial freedom, there is another aspect that you should consider. This is the financial institution you decide to choose to help manage your hard-earned money.
Tata Capital Wealth is a reliable and trustworthy financial institution that can be of service. With over 150 years of wisdom, our team can not only ensure your funds are safe but also guide you on how best to attain your financial goals.
To know more, visit the Tata Capital Wealth website today!
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