It’s hard to keep money off your mind!
You got bills, car gas, credit card debt, rent, or mortgage, and if you are lucky you can enjoy a little fun activity with anything that is left over.
If you are tackling your finances and are hopeful for something a lot better, this blog post is for YOU.
Like the captain of a ship peering out of his cabin window, this way of thinking can give you the panoramic view that will guide many of the important financial decisions in your life.
“Financial freedom is available to those who learn about it and work for it.”
Robert Kiyosaki
You want to know the steps for financial freedom? Let’s start with a definition…
What Is Financial Freedom?
Financial freedom is removing restrictions related to money. It’s freedom of choice.
Here is just some of what that freedom can include:
- choosing any menu item at a restaurant without concern for price
- buying the car you WANT, not just the one you can afford
- not dipping into savings to purchase something
- having enough money left over to grow your investments
- living a comfortable (or lavish) lifestyle without money strains
Some folks associate the phrase “financial freedom” with owning several cars, maybe a private helicopter, and living in a mansion.
For others, a used car that works and is dependable, a decent home or apartment in a nice neighborhood, and taking an occasional fun ride in a helicopter (but not owning it) are also examples of a lifestyle with financial freedom.
Whether you are retired or currently in college, financial self-sufficiency is not measured by your material possessions. It has more to do with how much freedom is leftover despite these things.
How do you know if you are finally financially free?
Well, if your income far outpaces your cost of living, that’s a very good indicator that you likely spend more time counting money than you do losing sleep over it.
How to Quickly Achieve Financial Freedom
It begins by choosing your personal amount of money required to live happily. It’s different for everyone, right? How much is a comfortable lifestyle for you? And do you actually believe you will achieve it? If your mindset and attitude towards money is negative, your subconscious mind will always find a way to sabotage your efforts. That’s a powerful key you can learn from Tony Robbins.
Here are 4 important things to consider when you want to rapidly achieve financial freedom:
4 important things to consider
1-Start from the Answer and Work Backward –
On a sheet of paper, run some ballpark numbers that represent your typical month. Add up the cost of rent, groceries, and utilities… the essentials. Then include the amount you want to allocate for savings each month. Everybody needs savings in case you suddenly lose your main income source. Next, include enough money for fun and leisure. Finally, add an amount (usually 2x your cost of living) that creates enough cushion in case something unexpected happens.
2-Eye of the Tiger –
Setting big financial goals is hard. Your friends and family might tease you or you might not believe in yourself. Keep your lofty goals in sight but break them down into realistic and actionable steps. Stay focused no matter what others say and minimize distractions (less social media and don’t binge-watch YouTube vids).
3-Plug the Holes In Your Ship –
You won’t get far if you have bad spending habits or debts that aren’t being paid off. Get a side hustle or a part-time job to rapidly pay off all debts. Learn to control urges to eat overpriced (junk) food by eating healthy snacks before heading out. Temporarily cut unnecessary monthly bills, like Netflix or that new meditation app.
4-Make a Plan or Plan To Fail –
You might not be a fan of discipline but it works! Studies have shown that writing down your plan of action will increase the chance of actually getting stuff done. Even better, carry it with you wherever you go. Commit to doing all the items on your daily To-Do list and get closer to your goal.
Remember, daily life is full of distractions. Viewing these as “bad guys” that steal your precious attention away from your goals will help you stay centered. If you can use this or similar tricks to return to your state of maximum productivity you will accelerate your financial freedom.
3 Best Habits to Reach Financial Freedom
In the above sections, I gave you the “panoramic view” and motivation to stick with your big dream. In this section, we need to get real about it. Here are some habits you should wire into the very fabric of your being.
1-Budget and Monitor Spending Like A Hawk –
I’m not saying track every last penny, although it wouldn’t hurt. What matters about budgeting and tracking your spending is that it REVEALS anything that is out of line. Think of what happens the moment a teacher steps out of the classroom and leaves kids alone for a few minutes. See what I mean? You have to be your own manager. I use Google Sheets to track my spending on several tabs and I even learned to turn my numbers into graphs so it’s OBVIOUS when the spending bug bites. Develop this habit of self-monitoring.
2-Drop Pennies in a Jar –
You’ve seen movies where the kid drops coins into his secret jar of money. Adulthood is no different. More than half of Americans have less than $1,000 in savings. The way to join the other half, the half with savings, is to turn the behavior of saving into a habit. The moment that paycheck shows up and right before you ask, “what should I spend this on?”, create the habit of taking 10-15% of putting into a savings account. If your job offers a retirement plan, talk to HR to automatically deduct this percentage from your check and place it in the retirement account. Your future self will thank you!
3-Stay Healthy –
I wasn’t going to include this because it seems too personal. However, modern science tells us that the food we eat directly affects our mood and intelligence. I know quite a few folks whose emotions seem to get the best of them. This directly correlates with their bad spending and terrible decisions with all things related to money. I won’t preach about what diet you should try. Any will do. If sugar makes you cranky or you find yourself lethargic and foggy-brained, consider taking up some sort of healthy eating regimen that includes the trifecta of proper sleep, healthy eating, and daily exercise. Your finances depend on it.
Level Up Your Financial Freedom
Handling your finances can be quite a task. Make it easier think of it like a video game and level up your finances. Most of us are born with zero money. We have to pull ourselves by our bootstraps, as the saying goes.
In the first level, we are dependent. That can be the teenager living at home. It can be the spouse who chooses to stay home and allow her partner to be the breadwinner. It can be the worker who depends on their boss (level 1 money novice).
The second level of financial freedom is living within your means or achieving solvency. This is the teenager who finally gets a job and no longer needs mom and dad to provide a room. This is the person who used to drown in credit card debt and finally made the final payment to clear it all up. At this level, you no longer depend on anyone and the shackles of debt are broken.
Level three is the first light of ascension. You now have extra money each month to put away for savings. You are building up your nest egg. Maybe you have long-term student loans but those are being paid on time and you still have money to spare. Life is pretty sweet but you still feel there is quite a way to go.
In level four you attain financial security. Most people won’t make it to this level. It’s when all your costs of living are taken care of and you don’t live paycheck to paycheck anymore. You have plenty of money in savings. Even better, your investments and other business assets more than cover your cost of living and you likely aren’t trading time for dollars. You are secure in your finances.
Any level you “play” beyond this is fantastic. You have achieved financial independence and you live abundantly. At this level, you can play “airport roulette” and travel to any random location without concern for punching a clock. You are the master of your time and both your savings and investments are taken care of far into the foreseeable future (level 10 gazillion MEGE MOJO MONEY MASTER).
Congrats You Beat The Game!
Popular Books About Financial Freedom
If this topic has excited you as much as it did when I first learned about it, here is the tip of the iceberg of books from a list of hundreds on the topic of financial freedom.
“Rich Dad Poor Dad” + “Cashflow Quadrant”
Author Robert Kiyosaki tells the story of a boy growing up with two fathers: his poor dad and his best friend’s rich dad, and the lessons he learned. Cashflow Quadrant is known for breaking down the transition from an employee, into self-employed, then into business owner with a system, and finally achieving investor status.
“MONEY: Master The Game”
Tony Robbins interviews billionaire investors and discovers they all have similar steps in common. Learn the 7 steps in this inspiring book.
“The Total Money Makeover”
Dave Ramsey has written a lot from the perspective of drowning in debt and feeling that there’s no way to escape it. This book gives hope to those who need a way out of debt one step at a time.
“The Millionaire Fastlane”
According to MJ DeMarco, there’s something seriously wrong with the old plan to get a degree, get a job, work hard, and somehow retire rich. This rarely plays out this way. Very entertaining. Be warned: the author uses strong language and will shoot straight.
“Secrets of the Millionaire Mind”
We all have a mental blueprint which determines how we think about money. If you want to change your current faulty blueprint to one that is used by millionaires, T. Harv Eker will break it down as a formula.
Conclusion
Financial freedom is all about autonomy.
It starts with breaking away from being dependent, moves into independence, grows into savings, and finally arrives at a point where your assets and investments sustain your entire cost of living and then some.
Writing down your big dream and “small chunking” it into actionable steps is key. Even better? Developing daily habits that get you there so that discipline is not an issue.
Thinking about the journey as levels in a video game is an accurate representation. Earn your way through each level and have fun.
Whether in the form of subtle distractions or massive setbacks, life will throw challenges at you which you must conquer. Re-center yourself and keep those goals in your pocket wherever you go.
Tell Me. What would you do differently?
Leave a comment below if you have suggestions for my next blog post or any questions regarding online income. I’ve got many more interesting articles coming out soon and I love to help!
One last thing, if you really want to take those first steps, here is a good place to start
Find Your Freedom
Wakeman
wakeman@dumpmy9to5.com
Fantastic read. The way you broke down the different aspects of achieving financial freedom made me stop and think. Sometimes I feel like I’m doing a good job with my finances, but whenever I get a wake-up call like this, I know that I’ve been ignoring some of my obvious problems. I need to develop a better plan/schedule for my work/personal life and stop using “self care” to justify spending. Do you have any tips on how to get that “self care” reassurance without wasting money on shopping or luxurious outings? I need the mental break sometimes, but digging myself into a hole is just going to result in more stress and more spending. Thank you!
Hi Maria Glad to here it got you thinking. As far as “self care” goes that’s kinda an individual thing. Personally I cook and spend outdoor time. Hope that helps.
Nice suggestions! These are very simple but they do work. And, even after their simplicity, people are not able to get results. I believe the reasons for that are what you have described in Point 4 i.e. Discipline. Financial freedom is not easy and cannot be achieved overnight. So it becomes essential to keep doing the right thing. In the beginning, it might feel that nothing is happening but we definitely get the results. Every journey starts with baby steps.
Thanks for the comment
Very true lack of discipline and lack of success often go hand in hand.
The trick seems to be to keep breaking the journey down into small steps (right foot, left foot) so it’s easier to maintain the discipline to climb the steep hills that life puts in your path.