The problem of most people struggling financially in life is not because the money is not coming into their hand but the problem lies in the way they handle the money that comes to them.
To some people when money enters their hand, the first thing they think of is what to buy with the money not even without considering investment it to maximize profit before spending from it not to talk of saving part of the money for future use.
The delightful thing is that there are ways to build a savings habit that will help you to fulfill your dreams. Read on to find help on how you can easily save money for the future.
The following are 10 things you must do to become financially free in life
1. Have a target or goal
All fingers are not equal, people earn different- that is savings pattern can be different. However, no matter what you earn, you should have a savings plan. When you do, you are much more likely to change your spending habits as long as you’re saving with something specific in mind. You should also save for a purpose, it will help you stay focused.
Know what you truly need, financially. Setting financial goals such as what you want to accomplish by following long and short-term goals, teach and caution yourself on the things that you have to let go because they are not necessary(make a list first, then tick what You actually need). This can be really helpful in forming a clear and effective strategy to finally start saving up.
3. Make a Budget
Making a monthly household budget, and sticking to it, is the best way to guarantee all bills are paid and savings are on track. It is also a monthly routine that reinforces your goals and bolsters resolve against the temptation to splurge.
4. Pay off Credit Cards in Full
Credit cards and similar high-interest consumer loans are toxic to wealth-building. Make it a point to pay off the full balance each month. Student loans, mortgages and similar loans typically have much lower interest rates, making them less of an emergency to pay off.
5. Create Automatic Savings
Pay yourself first. Enroll in your employer’s retirement plan and make full use of any matching contribution benefit. It is also wise to have an automatic withdrawal for an emergency fund that can be tapped for unexpected expenses and an automatic contribution to a brokerage account or similar account. Ideally, the money should be pulled the same day you receive your paycheck so it never even touches your hands, avoiding temptation entirely. However, keep in mind that the recommended amount to save is highly debated; and in some cases, the feasibility of such a fund is also in question.
6. Start Investing Now
There is no better or tried and true way to grow your money than through investing. The magic of compound interest will help your money grow exponentially over time, but you need a lot of time to achieve meaningful growth. Don’t try to be a stock picker or trick yourself into thinking you can be the next Warren Buffett. There can be only one. Open an online brokerage account that makes it easy for you to learn how to invest, create a manageable portfolio, and make weekly or monthly contributions to it automatically.
Taking good care of property makes everything from cars and lawnmowers to shoes and clothes last longer. Since the cost of maintenance is a fraction of the cost of replacement, it is an investment not to be missed.
8. Live Below Your Means
Mastering a frugal lifestyle by having a mindset of living life to the fullest with less is not so hard. In fact, many wealthy individuals developed a habit of living below their means before rising to affluence. Now, this isn’t a challenge to adopt a minimalist lifestyle nor a call to action to head to the dumpster with things you’ve hoarded over the years. Just making small adjustments by distinguishing between things you need rather than things you want is a financially helpful and healthy habit to put into practice.
9. Get a Financial Advisor
Once you’ve gotten to a point where you are able to discern if you’ve amassed a decent amount of wealth, be it liquid investments, or assets that are tangible but aren’t as readily available to convert to cash, getting a financial advisor to educate and help you make decisions is highly suggested.
10. Take Care of Your Health
The principle of proper maintenance also applies to the body. Some companies have limited sick days, making it a notable loss of income once those days are used up. Obesity and ailments make insurance premiums skyrocket, and poor health may force earlier retirement with lower monthly income.