For those living on a strict budget, finding financial freedom seems nearly impossible while trying to stay afloat of living expenses. It is possible. With strategic financial planning and discipline, financial freedom is not only within reach, it can be yours in a shorter period of time than you may think. Take a look at some of these tips to help you get on the road to living debt free.
Evaluate where your money is going
Like most Americans, signing up for certain subscriptions, utility features, and apps are far too easy and soon you are losing hundreds of dollars a month on services you don’t even use. Take a look at your bank statement and see where exactly your money is going to see what is needed and what can be cut out. You’ll be surprised at how much you save!
Make adjustments everywhere
Once you’ve cut out those expenses that are draining your paycheck senselessly, the next step is to adjust your budget to what is necessary. Separate your bills into three categories: Need, Want, and Like. Everyone is different, but the concept will be the same: the stricter you are with your budget, the sooner you will be free. If you have a timeline in mind - say you are evaluating to save for a home, your child’s college expenses, or even traveling the world - try and determine what you need to do at what period of time, so you will know what needs to be cut.
Get everyone involved
Even if you are the sole breadwinner/accountant/budgeter of your family, getting everyone involved is essential in becoming debt free. Maybe your partner or kids don’t understand what the end goal is, and all they see is their lifestyle changing. Keeping everyone in the loop, and even getting them involved in helping you achieve your goals, will make the experience smoother and even fun.
Create a money map
When you are focused on obtaining financial freedom, one of the most important things to do is know exactly where your money is going as soon as you get it. This not only creates a map of where your money is going (so nothing gets lost in the budget) but it also keeps you from spending money you shouldn’t be spending in the middle of the month. Paying all your bills in the beginning of the money (or whenever your pay period is) ensures no extra spending temptation mid-month.
There’s no grey area
You may be tempted to buy in to the idea that some debt is a “good thing”. This is a myth, especially when you currently have debt that you are trying to pay off. Keep the mindset that all debt is bad debt, and there is a light at the end of the tunnel.
Don’t be fooled, obtaining financial freedom is a trying process - but isn’t anything worth doing? Keep your end goal in mind: be it having no debt, saving for something special, or even preparing for retirement. These tips can be translated into any financial goal. Good luck!