To be financial success takes lots of courage and planning. We don’t have to be rich in order to be financial freedom. We don’t have to have lot cash in the bank to be financial freedom. In fact any body can attain financial freedom early depending on what kind of lifestyles you want in your life.
People often confuse about being financial success and that’s including me. I once thought that to be financial freedom I must have work harder with higher income. But now when I look carefully the meaning of financial freedom is to have income every month enough to cover my expected monthly expenses. Especially my income has to be passive income and better still from the business income. That is how I interpret and it could have different to you.
Financial Fundamental principles
In financial plan can be a budget, a plan for spending and saving future income. It helps allocate future income to various types of expenses, such as rent or utilities, and also reserves some income for short-term and long – term savings.
A financial plan can also be an investment plan, which allocates savings to various assets or projects expected to produce future income, such as a new business or product line, shares in an existing business, or real estate. This will give you passive income.
We should make it a habit to exercise prudence in all aspects of our lives, no matter what income level you’re at. This is because the money we have is all hard-earned throughout the years (at least for most of us) and if we are not careful, we may lose it all in a blink of an eye.
The other principle to keep in mind is patience. It’s hard to cultivate this virtue nowadays as everything is fast-paced and we’re living in an “instant” society – where everything has to be fast, easy and instant!
It’s advisable then to practice delayed gratification and it requires a great deal of patience too.
Last but not least, we need to have perseverance. To succeed in anything, we need to have that stamina to follow through our plans.
Some useful tips that I practice:
Budget
Everyone at personal level should have a long term budget and a monthly budget. A long term budget will guide you to achieve financial freedom goal and a monthly budget will make sure that you are on the track.
Do not spend beyond your budget and don’t spend more than your income.
Pay Yourself First
Once you have received your paycheck please practice this habit. Pay yourself first. Put at least 10% of your net income to a bank account every month without fail. These will not be use at all for any expenses or gift but rather it will be accumulated enough to invest one day.
Avoid unnecessary debt
Debt is a silence killer in our finances. Avoid debt at all cost unless it is a good debt. To me if I borrow money from credit card or bank to make money than I will go for it. Otherwise I will only use my credit card according to my month budget. At the end of the month I will usually pay all or maybe in 2 months max.
Start A Business Fast
Start a business and make business income. That is one of the powerful ways to generate more income than working for people. The best is starting a part time business while working full time. Aim to be a full time business owner one day when you are ready and you know the risk involved. Having a small business is the way to financial freedom fast.
Invest in Stock, Bond and Real Estate
At any time if you have enough capital considers buying real estate like house, condo for rental income. Otherwise start with stock. Be cautious though investing in stock is volatile now a days and you must learn it and be proficient in this. The dividen income, interest income and rental income will help you further.
I am not the financial adviser but I practice this method and it help me one way or another in my financial success. Hope it will trigger you to seek more information in finances and come back for more.
To Your Millionaire Success
Michael Liew