Originally featured on Wicked Cool Women.
If you’re like most people, you probably wish you had more money.
How can you get your financial life in order and achieve the level of financial freedom you desire? It may seem daunting, but it’s definitely possible with a bit of effort. In this article, we will provide 8 tips to help get you started on the right path!
Tip #1
Start by evaluating your current financial situation. This will give you a good starting point to determine what changes need to be made.
Keep this simple—get a piece of paper and write down your profits and losses for the month. (Think of profits as how much you earn/make; and losses as how much you spend.) How much are you spending on rent/mortgage, food, transportation, clothes, extras, etc.? How much debt do you have? This will give you a clear picture of where your money is going and what areas you need to work on.
Caveat: The most important part of this first step is to be honest with yourself. No secrets. None of the “Don’t tell Dad.” If you buy a latte at your local store four out of 7 days a week, be honest that you spend ~$80-100 on coffee a month. It’s okay; no judging. We’re here to problem solve. So, be honest.
Tip #2
Create a budget and stick to it! This is another important step to take in order to get your finances under control.
Determine how much money you need to live each month and make sure your spending doesn’t exceed that amount. There are a number of budgeting apps and tools available to help you track your spending and stay on top of your budget.
Tip #3
Save, save, save! It may seem difficult to put away money each month, but it’s important to start building up your savings. You never know when you may need it. Try to set aside at least $50 each month into a savings account. If you can, try to put away even more.
Remember it’s easier to have the cash to pay for something in an emergency than it is to have a credit card with high interest. You always will pay more for this emergency if credit cards are used.
Tip #4
Pay off any outstanding debt you have. This will help reduce stress and free up more money each month. If you have credit card debt, try to pay it off as much as possible each month. If you have student loans, consider refinancing to get a lower interest rate.
Bonus Tip: Use a method called the snowball method to help get rid of debt faster and give you a sense of accomplishment.
Tip #5
Invest in yourself. Take some time to learn about investing and how you can grow your money. This can be a great way to secure your financial future.
There are several resources available to help you get started, including books, websites, and courses.
Tip #6
Live below your means. This doesn’t mean you have to live a life of deprivation, but it does mean being mindful of your spending and living within your means.
If you want to save money, you need to be aware of your spending patterns. Track where you are spending your money and see where you can cut back.
Tip #7
Give generously. When you are financially stable, it’s important to give back. Not only is it good for others, but it can also be very rewarding for you.
There are a number of ways to give, including volunteering your time, donating money to causes you care about, or helping a friend in need.
Tip #8
Plan for the future. It’s never too early to start thinking about retirement and how you want to live your life after you stop working.
Start by evaluating your retirement savings and see if you are on track. If not, make some changes to your budget so you can start saving more. There are a number of retirement calculators available online to help you determine how much you need to save.
Bonus 1: Remember Time well spent = Money earned. How you spend your time will determine how much money you make. Use the 50/30/20 Rule:
50% of your time should be spent on making money
30% of your time should be spent on things that improve your life and make you happy, and
The last 20% of your time should be spent on learning and education
Bonus 2: Enjoy your life! Money doesn’t buy happiness, but it can help you enjoy your life more. Make sure to budget for some fun activities and experiences that make you happy. It could be something as simple as that latte.
By following these tips, you will be well on your way to financial freedom! Just remember it takes time and consistency to see results. Stay the course and don’t give up!
“You can be anything or anyone you want, just act like it.” – Tony Robbins
This quote is a great reminder that we have the power to change our lives, no matter where we start from. If you want to achieve financial freedom, it’s important to have a positive attitude and take actionable steps to reach your goals.
A quick story about my financial journey
At one point in my life, stars and merch flashed in my eyes when offered that “extra 20% discount on your first purchase” special if you open a store credit card. I bit every time!
Soon enough, not only was the amount of debt overwhelming to pay back in a reasonable time at an extremely high interest rate, the sheer number of credit cards I had to manage compounded the issue.
My credit fell dramatically, and it took me years to get financially stable and debt light. The actionable steps above, with a strong dose of discipline, got me to a place I felt good about. And I had to be honest… Soon enough I was debt free with a major feeling of relief. Continuing with this path, I’ve been able to achieve a level of financial freedom.
I’m confident if you act on these 8 tips today your financial freedom is attainable, too!
Ounce of Wisdom does not provide tax, legal, or accounting advice. Individuals should consult with their own tax, legal, or accounting advisors before implementing any planning strategies.
Have a question or your own actionable tip to share? Let’s hear from you in the comments.