10 Steps To Becoming Financially Free:
1. Make The Decision You will never become financially free until you decide to do so. You have to decide that you are tired of struggling, tired of living on credit, spending your future income to day, tired of not being able to give your family what they need and none of what they want. You have to decide that enough is enough and there must be a better way for you and your family. Decide you are sick and tired of the traffic, of the long hours and not spending time with family and friends and always being broke. Never again. It stops today.
2. Find Out Where You Are This is the most difficult part, taking an earnest look at where you are today, is hard but it is a way of taking responsibility. Knowing that the sum total of what you have financially and where you are in life today is the result of the decisions and choices from your past. They are why you are here this very moment. Your decisions in life, whether you went to college of not, the subjects you majored in, when you got married, where you worked, where you live, the car you drive, every choice you made contributed to where you are in life today.
The great news is, where every you are today, regardless to how happy or unhappy, you can change it for the better. But you first have to know where you are and make a plan to change.
Create a Balance Sheet. It is simple. On a sheet of paper drew a line down the middle. On the left side - list all of you assets, first your financial asset then your personal assets, strengths and talents. Your personal asset, strengths and talent are what will take you to the next level. On the right side of the paper list you financial debts and obligations. If you want more incentive, list the balance owed and the interest rate you are paying on the debt. Also list you personal weaknesses.
Subtract you total financial debt or liabilities from you total financial assets. The difference is you net worth. Hopefully it is a positive number. That is you total net worth as of today. If you are happy with what you see, there is no need to continue reading. If you are not happy, read on. Look over you weaknesses, from your list. Highlight the weaknesses, that if you would improve them, would make your life richer, financially or personally. The highlighted weaknesses are the one you need to work on. Take classes, workshop, buy a book or tape on them, what ever it takes to get more info and improve them or increase your skill do it.
3. Create A Budget Creating a budget is not a hard thing to do, just list all of your money coming in for the month and list all of you debts/obligation for the month and see what is left. A Budget will enable you to see where you money is actually going. If there is a large percentage going out in miscellaneous or other, find out what those things are and if you really need that much miscellaneous or other. If you debt is more that you income, look at your debt/obligations. Do you really need everything you are paying for? Is there something you can do without for a few months. I found $300 a month when I really took some time to look at my bills. The first thing I too out was Direst TV. I immediately saved $55. They were rerunning the same programs over and over again. I started to realize I was not watching and the TV was on only for the noise. I have learned to appreciate the quite. There is fat in your budget, you just have to find it and be willing to give it up. Think about it. It took me two months to find mine, hopefully you will find yours much quicker
4. Start Systematically Paying Off Your Debt After you find you extra $XXX.00 you can use it to pay off your debt. It the debt is not a part of an investment you dont need it. Start with the smallest bill you have. Pay the minimum payments on the rest. Concentrate on paying off the smallest bill using any extra. Be diligent and committed. Seriously strive to pay it off. Once the smallest bill is paid off, start working on the next smallest bill. Take the payment from the smallest bill you just paid and add that to the minimum payment of the next smallest bill. Soon you will have the second smallest bill paid off too. Next start on the third smallest bill, pay the minimum payment, plus the payment for the second and first smallest bill. Eventually you will get them all paid off and you will have extra cash at your disposal. You can add back the extras you want again. Be careful, I found having some extras was just a habit and I did not start them back.
5. Start Paying Yourself You should pay your self 10% of your income when you get paid. If you cannot start with 10% start with something and commit to increasing the amount to the 10% or more level.
6. Set A Side Some Play Money. That is money you can spend with out quilt because you set it aside for that very purpose. It will be easy after the debts are paid. You need to have some fun money to keep you focused on your larger goal of becoming financially free.
7. Set Some Goals Set some small ones, some large one and the some giant ones. Assign a completion date to the goals you set for your self. When you reach a goal, celebrate its completion. Continually review your list of goals. When you reach one, replace it with another. If you have a goal on your list that you are starting not to feel strongly about, take it off and replace with another. Your goals should range from a completion date of 6 months to ten years. Set benchmarks along the way to the completion of your goals. Stay focused.
8. Work You Plan Now you have a plan to become financially free, working your plan is the key. Review you balance sheet and you debt sheet regularly, every few month. You will be amazed to see how much you will achieve.
9. Use You Time and Your Money Wisely Think of a way you can earn more money. Let your money work for you by investing. There are many things out there. Stocks, bonds, real estate, a small business, a home business. Never invest blindly. If you dont understand how it works learn how it work through research, books tapes, library, Internet. If you still are unsure get a good, credible advise or help. Stocks bonds and mutual fund can be tricky. The can be great investments if you know what you are doing. Invest in something where you money will work for you. Go back to you list of assets. What are you good at, what do you do well, what do you enjoy doing, is there something that with a little help you could earn money for doing it for others. Remember, investing in your self for the purpose of earning more income is always a great thing. Be smart, before investing in anything, check it out. There are no miracle fixes out there but there are legitimate businesses other than franchises which cost can cost from $20,000 to $2,500,000 to start.
10. The last tip and the most important one is never give up Becoming financially free is not easy but is worth it. Money doest not make the world go round but it sure make the trip more fun. Money is not everything but it can get you a lot of things and get you on the list for most things. Money cant buy happiness but it can make unhappiness more tolerable. Money is not a cure all but if you give it to the right places, it can help find cures, feed the needy and less fortunate, house the homeless and educate the willing. It can help make this world a better place to live. I want to be able to give and be a part of that, I hope you will join me.
2. Find Out Where You Are This is the most difficult part, taking an earnest look at where you are today, is hard but it is a way of taking responsibility. Knowing that the sum total of what you have financially and where you are in life today is the result of the decisions and choices from your past. They are why you are here this very moment. Your decisions in life, whether you went to college of not, the subjects you majored in, when you got married, where you worked, where you live, the car you drive, every choice you made contributed to where you are in life today.
The great news is, where every you are today, regardless to how happy or unhappy, you can change it for the better. But you first have to know where you are and make a plan to change.
Create a Balance Sheet. It is simple. On a sheet of paper drew a line down the middle. On the left side - list all of you assets, first your financial asset then your personal assets, strengths and talents. Your personal asset, strengths and talent are what will take you to the next level. On the right side of the paper list you financial debts and obligations. If you want more incentive, list the balance owed and the interest rate you are paying on the debt. Also list you personal weaknesses.
Subtract you total financial debt or liabilities from you total financial assets. The difference is you net worth. Hopefully it is a positive number. That is you total net worth as of today. If you are happy with what you see, there is no need to continue reading. If you are not happy, read on. Look over you weaknesses, from your list. Highlight the weaknesses, that if you would improve them, would make your life richer, financially or personally. The highlighted weaknesses are the one you need to work on. Take classes, workshop, buy a book or tape on them, what ever it takes to get more info and improve them or increase your skill do it.
3. Create A Budget Creating a budget is not a hard thing to do, just list all of your money coming in for the month and list all of you debts/obligation for the month and see what is left. A Budget will enable you to see where you money is actually going. If there is a large percentage going out in miscellaneous or other, find out what those things are and if you really need that much miscellaneous or other. If you debt is more that you income, look at your debt/obligations. Do you really need everything you are paying for? Is there something you can do without for a few months. I found $300 a month when I really took some time to look at my bills. The first thing I too out was Direst TV. I immediately saved $55. They were rerunning the same programs over and over again. I started to realize I was not watching and the TV was on only for the noise. I have learned to appreciate the quite. There is fat in your budget, you just have to find it and be willing to give it up. Think about it. It took me two months to find mine, hopefully you will find yours much quicker
4. Start Systematically Paying Off Your Debt After you find you extra $XXX.00 you can use it to pay off your debt. It the debt is not a part of an investment you dont need it. Start with the smallest bill you have. Pay the minimum payments on the rest. Concentrate on paying off the smallest bill using any extra. Be diligent and committed. Seriously strive to pay it off. Once the smallest bill is paid off, start working on the next smallest bill. Take the payment from the smallest bill you just paid and add that to the minimum payment of the next smallest bill. Soon you will have the second smallest bill paid off too. Next start on the third smallest bill, pay the minimum payment, plus the payment for the second and first smallest bill. Eventually you will get them all paid off and you will have extra cash at your disposal. You can add back the extras you want again. Be careful, I found having some extras was just a habit and I did not start them back.
5. Start Paying Yourself You should pay your self 10% of your income when you get paid. If you cannot start with 10% start with something and commit to increasing the amount to the 10% or more level.
6. Set A Side Some Play Money. That is money you can spend with out quilt because you set it aside for that very purpose. It will be easy after the debts are paid. You need to have some fun money to keep you focused on your larger goal of becoming financially free.
7. Set Some Goals Set some small ones, some large one and the some giant ones. Assign a completion date to the goals you set for your self. When you reach a goal, celebrate its completion. Continually review your list of goals. When you reach one, replace it with another. If you have a goal on your list that you are starting not to feel strongly about, take it off and replace with another. Your goals should range from a completion date of 6 months to ten years. Set benchmarks along the way to the completion of your goals. Stay focused.
8. Work You Plan Now you have a plan to become financially free, working your plan is the key. Review you balance sheet and you debt sheet regularly, every few month. You will be amazed to see how much you will achieve.
9. Use You Time and Your Money Wisely Think of a way you can earn more money. Let your money work for you by investing. There are many things out there. Stocks, bonds, real estate, a small business, a home business. Never invest blindly. If you dont understand how it works learn how it work through research, books tapes, library, Internet. If you still are unsure get a good, credible advise or help. Stocks bonds and mutual fund can be tricky. The can be great investments if you know what you are doing. Invest in something where you money will work for you. Go back to you list of assets. What are you good at, what do you do well, what do you enjoy doing, is there something that with a little help you could earn money for doing it for others. Remember, investing in your self for the purpose of earning more income is always a great thing. Be smart, before investing in anything, check it out. There are no miracle fixes out there but there are legitimate businesses other than franchises which cost can cost from $20,000 to $2,500,000 to start.
10. The last tip and the most important one is never give up Becoming financially free is not easy but is worth it. Money doest not make the world go round but it sure make the trip more fun. Money is not everything but it can get you a lot of things and get you on the list for most things. Money cant buy happiness but it can make unhappiness more tolerable. Money is not a cure all but if you give it to the right places, it can help find cures, feed the needy and less fortunate, house the homeless and educate the willing. It can help make this world a better place to live. I want to be able to give and be a part of that, I hope you will join me.
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