There’s nothing like the sense of security that lies in knowing your financial future is sound. It’s a feeling many of us crave, particularly in the midst of those anxiety-fueled, 3am moments when your mind starts analyzing every dollar you’ve ever wasted in your life.
In such times, achieving the stable financial bedrock of your dreams can seem like an impossibly daunting task. If you’re at a loss as to where you should start, the four steps below will give you an easy-to-follow platform from which to launch your quest for economic freedom:
1. Take charge of Your Retirement Fund
When you’re young, it’s easy to think of retirement as some far off milestone that your future self can worry about when the time comes. However, this was exactly how you felt about graduating from high school when you were a kid. Any SMSF Accountants worth their salt will tell you that if you start funding your retirement now, there are a host of benefits to be gained. These include more flexibility in your investment choices, potential tax savings, higher returns, and cost savings options if you pool resources with your spouse.
2. Get Real About Your Expenses
You may have noticed the words “make a budget” don’t appear in any of the headings on this list. You’ve almost certainly read that piece of advice dozens of times, so there’s no point in telling you what you already know. With that said, examine the budget you’ve obviously already created (right?) and be ruthless with your expenditures.
Is there a gym membership you’re not using? ATM fees that keep popping up purely from lack of planning? While the money-sucking culprits will be different for each individual, the one guarantee is that everyone reading this article will have at least one unnecessary expense that can be cut from their budget. While making this assessment, be sure to check for any auto-renewing app subscriptions on your phone. Once that app you stopped using months ago auto-renews, your money is history.
3. Fill In the Middle
Knowing your end goal – financial freedom – is all well and good. However, if you don’t have all the steps between where you are now and where you want to be laid out, you’re setting yourself up for anxiety and failure. Your financial existence is not a simple thing. It has multiple dimensions, meaning any overarching financial goal you set will necessitate smaller milestones in all the various dimensions of your financial life.
There’s no generic guide to this step as it depends entirely on your specific situation. However, if the idea of creating such a roadmap for yourself seems impossible, consider sitting down with your partner or a competent friend or family member. If you feel like they’ll be as lost as you are, then it might be worth seeking the professional guidance of a reputable financial planner.
4. Commit to Living Below Your Means
This step may be last, but it’s perhaps the most important. The reason? It opens the door to financial freedom for everyone, regardless of your income. Employing all the steps above will allow you to see your present financial position and the steps you need to take clearly. However, it is living below your means that provides the fuel you need to propel you along your path to a financially secure future.
No-one said the road to financial freedom would be easy. However, if you start with the above four steps, the way is clear and the actions you need to take are straightforward.