Income able to cover the expenses and autonomy of choosing what to do with your money: achieving financial freedom is a much desired goal for most people, however, vast majority can not achieve that resulting. In this sense, in this article we present eleven key habits that help to guide this path.
1. Set life goals
A general desire for “financial freedom” is a very vague goal. What does that mean to you? Write down how much you should have in your bank account, what the lifestyle entails and at what age this should be achieved. The more specific your goals, the more likely you are to reach them. Write everything clearly and place this goal draft in a strategic place you will see every day.
2. Make a budget
Making a monthly family budget, and keeping it, is the best way to ensure that all bills are paid and to secure your savings. It is also a monthly routine that reinforces your goals, making possible “misunderstandings”.
3. Pay the total invoice for the card
Credit cards can be toxic to building wealth. Make sure you pay off the entire invoice balance each month, avoiding the accrual of interest.
4. Create automatic savings
Make sure you have a retirement plan and also an emergency fund, which can be availed for unexpected expenses. However, the money should only be withdrawn the same day you receive your paycheck, avoiding the temptation of unnecessary looting.
5. Ignore your neighbor “exhibitionist”
A neighbor buck who shows a new car or his latest Smartphone is no reason for you to do the same. Smile politely, sit back and have comfort knowing that your reward is tenfold in the future.
6. Track your credit score
A person’s credit score determines what rate is offered when buying a new car or refinancing a home. Even though not seemingly, it can also affect unrelated things like car insurance. A person with reckless financial habits is also likely to be reckless in other aspects of life, such as driving and drinking. In this reasoning, that is why it is important to keep track of the credit score regularly, to ensure there are no “slips” that could destroy your good name.
7. Trade without fear
Many people hesitate to negotiate goods and services, and worrying about it seems “petty”. However, overcome shame and this silly stereotype and watch your money grow each year. Small businesses in particular tend to be open to trading, where bulk buying or repeat business can open the door to good rebates.
8. Continuing education
Review all applicable tax laws changes each year to ensure that all adjustments and deductions are maximized. Track news and financial developments in the stock market and do not hesitate to adjust your investment portfolio accordingly. Knowledge is also the best defense against those who feed on unsophisticated investors to make quick money.
9. Take care of what is yours
Take good care of the property, from the car to make your clothes last longer. Since maintenance cost is a fraction of the cost of replacement, it is an investment not to be missed.
10. No more and no less!
Adopting a moderate lifestyle by having a mindset of living life to the full with less is not that difficult. In fact, many wealthy people have developed the habit of living with what they need, without extrapolating their money with unnecessary luxuries. Now, this is not a challenge to adopt a minimalist lifestyle, much less to throw in the trash all the things you have accumulated over the years. Simply making small adjustments, distinguishing between things you need, not the things you want, is a financially useful and healthy habit to put into practice.
11. Find a Financial Advisor
Once you have reached a point where you are able to discern if you have accumulated an appropriate amount of wealth, whether with liquid investments or tangible assets, but are not so readily available to convert into cash, getting a financing. The financial advisor will help you make the best decisions, so it is highly recommended.
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