Money. Wealth. Financial Freedom.
As a continuation of my recent post on having the courage to manage your money, today I would like to outline the steps you’ll need to take in order to become financially free.
Step #1: Learn the basic principles of money and acquiring wealth
There are many resources available – utilize them. The Internet, your local public library, and friends and associates who have walked the path to financial freedom before you are all wonderful places to begin the process. Make friends with the reference librarian at your local library; he or she can guide you to a basic text on accounting and money management. Become familiar with financial terms and concepts. Keep a dictionary close by and use it! Don’t be afraid to look up a word you don’t understand; if you are afraid to, do it anyway.
If you’re really serious, continue your education in financial topics by reading articles in both business and financial magazines and newspapers, such as Fortune, Forbes, Black Enterprise, Money, Entrepreneur, Fast Company, and the Business Times.
Step # 2: Keep a piece for yourself
Of all money you earn or acquire, stash 10 percent away for yourself and just save it. Don’t spend it; don’t make it a rainy-day fund, just save it. In the beginning, 10 percent may feel like, or actually be, too much to spare; if so, start smaller, but start! Amazingly wealth starts from saving one penny at a time!
Step #3: Avoid Debt: Spend less than you earn
Not a novel concept, but one that eludes scores of people as evidenced by the large debt many of us carry. To build financial freedom not only must you have a steady flow of income and save on a consistent basis, you must spend less that you earn.
Step # 4: Grasp the concept of wealth
Wealth is not defined by what’s in your wallet, your bank account, your stock portfolio or the size of your house. It’s defined by your steady flow of income, how much of it you keep, and your ability to make it multiply. Money is short-lived changing hands quickly and easily. Wealth on the other hand is everlasting because it keeps growing. If financial freedom is your goal, it’s not enough to save, spend less than you earn, and eliminate debt. You must grow your income.
Step #5: Wealth is worth working for and waiting for
Sometimes that means following through on a commitments even though it seems hard or doesn’t yield an immediate result. Do your homework in choosing appropriate investments that will yield a return and allow your money to work for you. The key is doing your part in the process at the beginning, then letting go of the results.
Step #6: Seek counsel from a financial expert
You wouldn’t go to your hairdresser to fix your shoes unless he or she was also an expert in shoe repair. Likewise don’t go to non-experts for financial advice unless they’ve demonstrated their skill in such matters, such as with a successful business or a life of financial freedom.
Financial freedom is about empowerment, about taking control of your life so you can genuinely feel better about yourself. It’s an Esteemable Act to study your finances so you can understand where you are at. It’s an Esteemable Act to be ready willing and able to take care of yourself financially. It’s an Esteemable Act to be self-supporting through your own effort and not be dependent on your family, your spouse, the government, or a job you hate.