First off, what is financial freedom?
Simply put, financial freedom is the ability to live in a lifestyle that you want minus the financial problems. Meaning you already achieved financial stability and security. Having a high salary doesn’t necessarily mean you have achieved financial freedom. One may have that but could still be buried in debts and bills. Even a million dollars can bid you goodbye in one fell swoop.
“Being financially rich and having the ability to live like a millionaire are fundamentally two very different things.” This is from Tim Ferris, author of the book Four Hour Work Week.
People want a worry-free life; that is, to be able to sleep at night without thinking about debts, bills or other money related problems. Being financially free is a luxury few people can achieve. But how does one achieve financial freedom? This article will be focused on how one can achieve this stressed free lifestyle. Here are a few ways to become financially free.
1. Change your lifestyle.
This is one step in achieving financial freedom. Know and understand how you live your day-to-day life. Do you feel like you spend too much? Are your phone and electrical bills high? Remember that you shouldn’t be spending more than what you’re earning. If you see that it is not enough to cover your needs, then make adjustments. Cut your vices if you have to. Use personal checks to cut your cost on getting outrageously priced bank checks. Ask yourself, do you really need this or that in your daily life? The problem with most people is whenever they have money in their hands, they are itching to spend it. What you need and what you want are two totally different things. Discipline is the key.
2. Pay off your debts ASAP.
Paying your debts should always be top priority before saving. Holding your debts increases your monthly expenses especially in credit cards due to their high interest rates. After paying off, stop taking in new debts.
You probably have a savings account already, but why stop there? There are a lot of things where you can invest your money on. Invest on stock markets or real estate. If you want a close-to-risk-free investment, invest in bonds. Bonds are backed by the government. Their prices can rise or fall based on interest rates. Holding them to maturity guarantees a full value of the bond.
4. Put up a business.
Here’s another way of generating extra income. You could start a business and hire people to do the work for you. This may require a huge capital but in the long run, it will generate income if successful. Be warned though, one does not simply start a business. You’d have to know the game and get the right people for this to work.
5. Venture into Multi-Level Marketing.
Though this method may not have a good reputation, multi-level marketing or MLM can build up a huge amount of income. As a distributor, you need to sell the company’s products and recruit more distributors creating a substructure which is called a downline. Distributors will have a commission on sales of other distributors on their downline; thus, having a considerable number of downlines will net you large amounts of money plus your own sales. This method alone can help you achieve financial freedom.
6. Do Affiliate Marketing.
A good way to earn cash is by promoting other businesses through your website or blog. That’s what affiliate marketing is basically about. By promoting an online merchant’s product, you gain profit through sales, clicks, downloads, registration, etc. This can net you a considerable amount of money depending on your website’s traffic. You can learn more about affiliate marketing and its secrets by joining online communities for affiliate marketers.
7. Look for other sources of income.
Be always on the lookout for opportunities to earn more income. Sticking to one side job will take you forever to achieve financial freedom. A simple hobby or passion can turn into a handsome profit. Writing a book is one good example. Books can still earn even after it is written, should it get published of course.
Financial freedom can also be a way of thinking or a mindset. Those who live and believe in simplicity and contentment can be considered as people who are financially free. Remember: Money is not always the solution to people’s problems.
Financial freedom is not what you would describe as an overnight achievement. It requires patience and perseverance. Set goals and do what it takes to achieve them.