What would your life be like if you didn’t have to worry about money? Your bills on autopay, money in the bank? An emergency expense is but a minor inconvenience? If this sounds out of reach for you, then maybe it’s time to re-think the way you see your finances. Setting sail towards financial security might be a lot easier than you may think.
Start Early
Why wait to start saving for your future? Start now. The fact is, the earlier you start saving your money and managing it well, the more you’re going to have in the long haul. Not only are you giving your money more time to compound, but you’re also giving yourself time to make (and learn from) mistakes.
Start Thinking About Retirement
It may be hard to force yourself to dwell on something that is so far off into the future, but having good retirement savings will take care of a lot of worries you might have otherwise had to deal with down the road. It’s also a smart idea to get your end-of-life expenses out of the way, too. Funerals are expensive. Having life insurance can help you relieve a lot of your financial stress. Investing in a life insurance policy can help you in both the short term and the long run, especially if anything should happen to you or a family member. Choosing a life insurance policy that has a cash value can even act as a form of savings. Additionally, as you age you may be able to sell your policy for cash through a process called a life settlement. Make sure to avoid a prepaid funeral plan, as they can’t be changed, and the money you put into it can’t be used towards anything else.
Live Within (and Below) Your Means
Figure out what’s important to you and devise your budget around that. Make sure that you set aside money for savings first thing, then stay on top of your bills. If you have your eye on a fun new gadget or piece of clothing, make it a point to save for it, rather than buying on impulse. Don’t spend money you don’t have on things you don’t need just because you’re trying to keep up with the Joneses.
Don’t Put All Your Eggs in One Basket
The idea of diversification is not a new one. Keeping a diverse financial portfolio can help you save money and even bounce back with ease should one of your financial channels dry up. A mixture of savings, stocks, and investments are just a few good examples.
Be a Little Selfish
When it comes to setting up your financial future, it’s okay to put yourself first. Sometimes you need to focus on your own finances, especially when you have a goal of financial freedom on the brain. It may be hard to watch others around you struggle, but building your own strong financial foundation will be worth it.
Deal with Your Debt
If you’ve ever owed a debt, then you know how smothering it can truly be. The first step is to avoid getting into debt in the first place. Don’t fall into financing traps, and make sure you pay your bills on time. Consider setting your recurring bills on an automatic payment schedule, or even simply set a reminder in your phone. When it comes to paying down debts, start with high-interest items first. This way, you can avoid paying on interest and save more money over time. Getting out of debt isn’t easy, but working towards a debt-free life can give you the ultimate sense of freedom that you crave.
Seek Help
Don’t be afraid to ask for help from a professional planner or financial advisor. While it may sound counterintuitive to spend money in order to save money, it might be worth considering. Getting advice from an advisor prevents you from a financial blunder and may be worth the investment overall.
Stay Focused
Taking care of your finances can be hard. When you have only daunting, long-term goals in mind, it can be easy to lose motivation. Make sure that you recognize if your drive is slipping and put in a genuine effort to stay focused on what matters. Balance your vision with both short and long-term goals and surround yourself with friends who have similar goals. Keep things realistic, and more than anything else, be patient. After all, good things take time.
