financialtreat – will explain about Get to know the Financial Freedom Movement which you will get in the following article. let’s look at this article carefully!
The term Financial Freedom Movement arises from a condition where a person is free from all kinds of debt, has passive assasination that can meet the needs of life, is financially protected from all risks, and no longer has to worry about us having to work to spend money to have fun.
To realize this Financial Freedom Movement requires several points that must be met for individuals and groups. the conditions that must be met are mandatory to have good financial planning.
Getting to Know the Financial Freedom Movement
From the information above, we already know at a glance about financial freedom. the problem is that many people have no experience or gained learning in school or college. therefore not everyone has a good education about this one thing.
However, quoting from various sources , financial freedom does not always have to be interpreted as having a lot of money. Financially freedom can be obtained when a person can live a life of merit, in moderation, and debt-free
If referring to the latter definition, a worker with a non-exorbitant income also has the opportunity to achieve financial freedom when he already has a pension fund, an emergency fund, investments with safe instruments and returns above inflation, life and health insurance, and funds for children’s education if they have a family. In fact, debt is still tolerated if it is for productive assets.
There are several things that we must know for the current generation to respond and realize the financial independence movement:
Tips for Achieving the Financial Freedom Movement
Avoid Debt for consumption
If you use a credit card to buy consumables, it will only enrich the bank. So the first step that must be done is to avoid high-interest debt as much as possible, such as using a credit card, to paying car installments. The point is, not borrowing money for just consumption which can still be avoided.
Sometimes, one of the reasons why we spend so much money to buy things is because we want to follow friends or neighbors. Most of us don’t actually need a 900-square-meter house or a luxury car.
A simple house and car are actually enough for the necessities of life. The advertisements on TV that make this life a competition to buy the most excellent and expensive things. So, in order to achieve financial freedom, don’t be easily tempted by such things.
We don’t need to always look at what others have and compare with ourselves. Everyone has their own standard of living needs and financial capabilities. Therefore, it would be nice if you meet the needs according to financial conditions.
Spend less than earned
This step is the real key in collecting income. The first thing you need to keep track of your expenses and see what you’ve been spending money on for. Then you can cut things that are not neede and minimize the number of lifestyle spending.
Naturally, this step needs perseverance in order to bear fruit in the next few years. What needs to be remembere is that it is necessary to maintain a balance between expenses and income. So, avoiding expenses that are greater than income is an obligation if you want to go towards financial freedom.
You should prioritize saving above all else. It is recommende to save first before buying groceries, paying electricity bills, or paying rent. The method of paying bills by deducting directly from workers’ salaries is also a great method of prioritizing obligations. That way, you can use the remaining money to save, after paying basic obligations for yourself.
Buy revenue-generating assets
Once you’ve started saving, you’ll need to invest money in income-generating assets. Currently, there are many investment instruments that are safe while promising stable profits.
Assets that can be purchase can be gold, property, land and so on. Focus on buying assets that can make money instead of being complacent about electronic products or other goods whose value will continue to fall from year to year.
Continue to invest
If you keep money in the bank, the value will be reduce due to tax deductions, administrative fees and inflation. Then you should start investing in the stock market. Choose the type of company that is suitable and right for you, if necessary, first consult with people who are experts in their fields to determine.
However, it is necessary to be careful if you want to invest in the stock market because it is high risk. Other investment instruments, such as mutual funds, bonds, and deposits can also be an option to double the value of assets.
Stages Towards Financial Freedom
The road to financial freedom is actually complex and winding. Citing a Forbes article, an effort to realize financial freedom is like a marathon, not a sprint. So to achieve financial freedom requires a number of processes and a long time. It is good if a person begins to take steps towards financial freedom, from a young age.
To make it easier to meet the target of financial freedom, you should break the big target into small stages that must be achieve. This method can make the long process towards financial freedom easier to manage, and also easy to start because it departs from a low step.
· Step 1
Not Dependent on Salary The first level of financial freedom is to have an emergency fund or deposits that are sufficient to meet various urgent needs, so you don’t have to rely on salary alone.
Most people probably get some unexpected bills that come up throughout the year. Having an emergency fund will be useful in such a situation.
· Step 2
Have Enough Funds to Quit a Job Temporarily Financial freedom can also mean making a job an option. Saving enough money to quit a job forever, of course, is a big job.
However, if you can only raise money for provisions when you quit your job temporarily, a kind of sabbatical, is a big leap to the original goal. On the other hand, in the short term, the extra money collected can also be your emergency fund.
· Step 3
Have Enough Funds for The Necessities of Life and Keep Saving It’s more about enjoying your life and having the money to do it. There is a huge sense of relief when you have enough money to save, do things you like, and still have more money at the end of the month. This is certainly assuming that you avoid an extravagant lifestyle.
· Step 4
Have Time Freedom What many people want is to be more flexible with their schedules. Freedom of time and financial freedom go hand in hand. This condition can come in the form of more time off, flexible time or working remotely on certain occasions. So, do not have to take one day off from work just to visit the dentist or take the child to the doctor.
· Step 5
Have Enough Funds to Retire Simply For those of you who want to retire early with financial freedom, maybe you can target this step. So, the pension fund does not have to be large, as long as it is enough to meet basic needs while not working.
Consequently, life after retirement must be live simply. Considering retiring faster with minimum funds, can encourage you to be more careful in using money. So instead of paying in installments for a luxury car that will force you to work for a few more years, it is better to choose to save money so that you can quickly retire.
· Step 6
Have Enough Funds to Actually Retire Assuming you’re happy with the standard of living while still working, how much funding will it take to continue living it in retirement? If you already have enough savings, as well as assets and passive income that can support retirement with a preferred lifestyle, it is a great achievement towards financial freedom.
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· Step 7
Have Enough Funds to Retire according to Your Dreams To be able to get away from work, free to travel and spend a lot of time with friends and family, as well as being able to travel the world, how much pension funds do you need? Aspiring to achieve such a dream retirement condition does not hurt.
By thinking about such a thing, you can consider whether the current conditions are worthy of the dream pension fund, or there are obstacles to achieving it before the age of the elderly. Having sufficient funds to undergo retirement according to dreams is a high step in the stage of financial freedom.
Thus the review of the Financial Freedom Movement, the information above is a form of being one step ahead so that you can overcome your financial problems, by doing some of the steps above hopefully can overcome your financial problems.