Achieving “financial freedom” can be a challenging concept because people don’t usually know what they want or what they mean by being financially free. For the most part, people want to feel secure about their finances and have the ability to fulfill their desires without constantly worrying about money. However, various factors can contribute to financial worries, such as mortgage payments, credit card debt, and the amount of money saved for retirement.
The cost of what you want to buy is also something that varies greatly from person to person. Some individuals simply enjoy taking leisurely strolls in the forest, while others are passionate about exploring new destinations. So how we define financial freedom is subjective and varies for each person. Financial freedom often becomes a primary objective for individuals as they approach retirement. They aspire to cease working and eliminate any concerns about monetary matters. So how can you become financially free?
Step 1: What do I want?
To kickstart your retirement planning, it’s crucial to clearly outline your financial objectives. Determine the amount you wish to allocate towards essential living expenses and extra indulgences like vacations and hobbies. By creating a practical monthly budget for your retirement, you’ll gain valuable insights into the amount of money required for true financial freedom.[1]
Step 2: Live below your means
If it’s feasible, try to minimize your expenses for items that are not essential. Some individuals tend to spend all their income without saving enough for unforeseen circumstances or future needs. By reducing unnecessary expenses, you may find that you have more financial flexibility and more money to put toward your retirement.[2]
Step 3: Consider talking with a financial professional
Financial professionals have extensive knowledge and expertise in financial planning. They engage in problem-solving with their clients, focusing on the concept of financial freedom and providing tailored strategies and guidance to try to help them attain it. If you are interested in trying to attain your own financial freedom, don’t hesitate to contact us for a complimentary assessment of your financial situation.
