When you look at the rich people enjoying their financial freedom and greatness, the main question is how did they get there? How can I get there? In personal finance, everything narrows down to planning, sacrifice, discipline, and being smart. From understanding credit, savings, and growing revenue, it is important to follow the right steps and grow from one level to the next. To understand more about finance and reach financial freedom, here are some personal finance tips from experts that you can use.
- Start as early as possible
To succeed in your finances, it is never too soon to start saving, planning, and investing your money. Though money might be limited, starting early gives you all the requisite skills to grow fast and understanding mistakes to avoid in future. At the age of twelve years, Carlos Slim Helu (a Mexican businessman who was ranked the richest before Bill Gates) started buying shares in one of the Mexican banks. Start saving some dollars every month, work on a new business plan, explore methods of making more revenue, and commence on the right foot.
- Find a personal passion
The fundamental benchmark for financial success is identifying what you believe in. Financial experts emphasize that believing in yourself costs nothing but can easily grow and take you to where you always dream about if nurtured well. Take time to find that thing that you love and you will find it easy to grow and succeed because it is part of you. It is because of this that you will find some people succeeding in businesses that you cannot imagine venturing into. You might not like venturing into the fashion business, but you can start learning about the web design you cherish so much online right away.
- Make a financial plan and keep reviewing it over time
A financial plan is a pathway to your financial success because it gives the real picture from the beginning to the end. With a good plan, you can look at your life and navigate it like a plane from one point to another. To make the financial plan successful, focus your efforts on reviews and gather the courage to make changes. Keep asking yourself the following questions: Have I made the steps that will take me to the next level? What obstacles are on my way and how can I remove them?
- Spend less today to become wealthy tomorrow
Today, many people have been lost in the ‘dangerous’ culture of spending. People want to have newer stuff not because what they have is not working, but to go with the culture of spending and look new. Think of the smartphone you want with very top specs and yet you rarely take photos at distances longer than a few meters. Besides, even the current phone has not broken down or malfunctioned.
The same case happens with cars. More people want to buy the latest car models yet they are doing fine with their current ones. Think of it this way, Jim Walton (the Wal-Mart billionaire) drives a 15-year-old pickup while Ivgar Kamprad of Ikea uses a 10-year-old Volvo. The point here is getting frugal and moving from one point to the next in significant comfort is all you want. If such billionaires can drive in such old vehicles, you can also go frugal to become wealthy tomorrow.
- Go an extra mile to clear your debts
While the traditional saying that only rich are debt free is replayed over again, the truth is that you can also be debt free. Well, getting debt free requires proper planning and hard work. How can you achieve this?
No matter how you fell into debt, here is a roadmap you can use to get out. Establish the minimal amount that you can make on every debt. Then, use the extra cash to clear the debt with least balance. Once that debt is cleared, move on to the next and keep updating your credit score. You will keep clearing the debts faster, making the burden lighter, and become debt free at last.
- Get a financial partner
No matter the way you approach it, managing your money is never easy. That is the truth. Life can change direction after shifting careers or even quitting a job to focus on business. To keep your goal well focused, what you need is a financial partner to help you work through every situation. Identify a financial expert you share the same goals and then make it a routine to review and improve financial undertakings. This way, you will reach the financial status you are looking forward to faster than you think.
- Strengthen personal brand
One of the leading business coaches, Josh Felber emphasizes that you should make personal brand omnipresent to succeed. No matter where you go, take the brand with you and keep the wheel of success progressing. Think of Donald Trump (like him or hate him); whenever he goes, talks, or visits a place, his ideology comes out articulately. For your business, taking it with you all the time provides the opportunity to market, talk, and respond to clients physically and on social media. For example, have your car painted with your business products and contacts. Check requests and replies on social media via your phone and stay connected with all followers.
- Focus on personal development/ invest in yourself
In personal finance, one thing you must contend with is that you are the most important asset. Because of this, you should never feel at the comfort zone, but keep developing yourself. This will give you extra negotiating skills, exposure to new investment opportunities, and impetus on driving change. Farnoosh Torabi, the author of When She Makes More and other two top selling books explain that personal development can be in the form of traveling, taking risks, taking extra classes, or joining a workplace team. With self-development, you always stay proactive and ahead of competitors.
- Save for emergencies
If you do not have money in the bank, emergencies can easily slide you into great hardships and even debts. When seeking cash during such emergencies, you rarely have time to check which is the best and, therefore, easily fall into the trap of higher interest rates.
To stay free from emergency perils, make sure to establishing an emergency fund. You can start with a buffer of about $1,000 to meet daily expenses and then (after clearing debts) work on a larger emergency fund. Consider a fund equal to about ½-1 year cumulative expenses so that you can be able to handle even the most serious emergency.
(x) Invest in the future
Once you have worked up the financial plan, saved significant amount and everything is going as expected, you need to put the money into the future. By investing, you make the money drive you to greater prosperity. To invest in your future, consider starting to pay pre-tax saving plans or putting money in mutual funds among others. At this point, it is very critical to ensure you understand the plan that your money is going into. Because you will be putting money that you have laboured so much to save, getting assistance from a financial expert will be very important.