Have you ever been in a situation where you want to do or buy something, but you can’t do it because your finances are holding you back? I guess almost all people have been there. Even the most successful individuals nowadays have experienced it at some point in their life. Why do you think they got motivated to achieving success? Some people had to learn it the hard way. Take a look at the story of Kalen from MoneyMiniBlog. If you want to take control of your finances and become financially independent, you have to start TODAY!
How to become financially independent?
Becoming financially independent is the ultimate goal of controlling your personal finances, and this won’t happen overnight. You have to set your goals and priorities and stick with them so you can be successful. Otherwise, you will just end up going to where you were.
Here are some useful tips on how to become financially independent.
Get rid of your consumer debts
Many people may look at consumer debts as useful resources everytime they need financial assistance. While this is true, these loans can also eat you up. Take note that all consumer debts bear interests. If you have taken out loans like personal loans, student loans, car loan, or housing loan, just think of how much you are paying on the interest alone. If you haven’t taken out such loans, the amount that you are paying for the interest rates can actually be your savings or you can use it for your other personal needs.
Therefore, you have to get rid of your consumer debts. Start working on those with higher interest rates. It may take you quite some time to do all these, but in the long run, once your are debt-free, you will see a big difference.
Set a realistic budget
When setting a budget, you have to be realistic. Consider your average income and take note of all your expenses. You have to prioritize your ‘needs’ and as much as possible, lessen your ‘wants’. Once you have done setting a budget, make sure that you follow through. Otherwise, you may have to go back borrowing money again.
Whatever extra money that you will have after setting aside the budget for your expenses, put it into your savings account regardless if it is just a small amount. If you start doing this, you will eventually build your savings.
Earn side income
If you can and if it is possible, you can consider earning side income. With this, you have a lot of options. Your side income can help you build bigger savings.