Did you know that more than 35% of people in the United States are struggling financially?
Prices for goods and services are on the rise, with no end in sight. Unfortunately, many people can’t make enough money to keep up with the costs.
If you want to get control over your finances and prepare for retirement planning, there are several steps to take.
Continue reading if you want to discover the 7 steps to financial freedom that will help you save money!
1. Make Goals
The first task of the 7 steps to financial freedom is to identify and write down your goals.
Personal and career goals should get considered to determine where you see yourself in 5, 10, or 20 years from now. Identifying your goals at an early stage will help motivate you when you come across challenges.
When you can see what you are working toward and the improvements you’ve already made, the task seems more realistic. Saving money and adjusting your finances takes time and many people struggle to achieve goals because of temptation.
Always refer to your goals to ensure you won’t let yourself down. If you are having a hard time completing them, you can adjust your timeline or add additional and smaller goals.
How Can I Make SMART Goals?
Over 90% of people fail to reach their goals, and the reason is often because of how the goals were defined.
If you want to follow through on your goals, you need to understand what makes up an effective one. Goals should be specific, measurable, and achievable. You also want them to be relevant and timely. When you are missing even one of these components, it’s easy to fall off track.
While you make your goals, you should also consider 3 other factors. For your goals, you’ll need to determine the lifestyle they require, how much money you need to be saved, and a deadline. Most people use their retirement date as the deadline.
2. Set & Follow Your Budget
It’s common for people to hire someone else for financial management needs, especially when it comes to budgeting.
Budgeting can be a challenging task, but as long as you are honest with yourself and realistic, you should get your number. A monthly budget is best to create since bills and cards get charged only once a month. You must compare your total income with expenses for bills, groceries, and pleasure.
When you fluctuate your spending habits and don’t have a budget, it’s easy to overspend. Even if you think you have plenty of money in the account, each day of savings matters. Try to be consistent with your purchases and stay within your budget to avoid debt or extending your timeline.
You can try our 5-Day Budget Challenge for a smooth transition, our methods will quickly show results. The budget is centered around your paychecks and offers a realistic assessment of your finances.
Budgeting Factors to Consider
A recent survey found that more than 40% of couples in the United States have shared assets.
Sharing accounts with your partner can improve your financial situation, but it can also prevent you from reaching goals. If you share accounts or money with your partner, make sure you discuss your budget and goals with them. Both people must be on the same page to avoid the other person from overspending.
Rising costs for goods and services are other factors to consider. Although wages aren’t increasing as quickly, you’ll need to adapt and might have to tighten your budget. Monitor your monthly spending to ensure you are saving enough.
3. Automatically Save
It’s easier to save money when you never see it enter your spending account in the first place.
When you sign up for your retirement plan and work with HR at a new job, you should consider auto saving. You can set up your paychecks to deposit money into one account and another portion into a savings account. This is a great way to save money for the holidays, a home, or other large expenses.
For long-term savings, you should put a portion of your paycheck toward retirement savings. You can base your budget around investing this money and still meet your financial goals. The best part about using your job’s retirement savings plan is that most companies will match your contributions.
4. Invest Some Money
Depending on your budget, you should consider investing a portion of your money.
You can accumulate wealth by keeping large sums of money in a savings account, however, this takes a long time to see results. Investing in the stock market, crypto, or real estate can put you ahead of the game and take you one step closer to retirement.
Think about investment strategies that are interesting to you. If you don’t have the passion or motivation to learn about them, you’re more likely to lose money than make any.
Keep in mind that all investments come with risks. Weigh out the pros and cons of each investment strategy and diversify your investments over time to accrue the most wealth. Make sure you aren’t investing all of your money, since unexpected expenses can arrive at any moment.
5. Reduce Credit Card Debt
Debt management is the most difficult part of the process, especially if you’re up against heavy interest rates.
High-interest rates can hold you back from ever achieving financial freedom. You should try to pay off the full balance on your account at the end of each month. Unfortunately, this isn’t realistic for most.
Paying the minimum payment will prevent your loans and accounts from going into default. You should never skip one of these payments and try to pay more than the bare minimum. When you pay above, you can reduce loans and debt faster.
Experts recommend using budgeting tools to pay debt fast. You can learn about your options through our blog and discover the methods that have worked for others!
Strategies for Lowering Debt
Credit cards are a useful resource if you don’t have enough money and an accident or unexpected event occurs.
When their balances are full, however, they won’t help you, but only put you further in debt. To lower your credit card debt, try to pay double the minimum payment if you can’t pay in full. You should also keep your credit cards at home and remove the information from automatic payments on shopping sites.
Easy access to your credit will prevent you from achieving goals since the purchases can hide. If you have too many credit cards, you should pay the lowest one down first and close the account or leave it with a zero balance.
6. Educate Yourself
When it comes to financial planning, the more knowledgeable you are, the more you can save.
Understanding tax laws and keeping up to date with financial news can help you invest wisely. Since the stock, crypto, and real estate markets are influenced by trends, you must do your research.
It’s also important to educate yourself on scams that investors often experience. You can learn from others’ mistakes so you don’t have to suffer as they did. There are many online resources, such as our blog, that can keep you current with financial news.
7. Take Care of Your Health
Too many people are tied down with debt from medical procedures, prescriptions, and other expenses.
Taking good care of your physical and mental health can save you a lot of money over time. Instead of paying for expensive surgeries and visits, you can invest your money in your future. When your health is declining, your bank account likely is too.
Attend regular appointments with your doctors to take preventative measures. When issues are caught at early stages, they are cheaper and easier to resolve. Poor health can also prevent you from financial freedom if you have to take time off of work for sick days and procedures.
Don’t let your health impact your bank account and retirement goals.
Break Free With These 7 Steps to Financial Freedom
When you use these 7 steps to financial freedom, you can learn how to save money and watch your account grow.
Having SMART goals to start with will motivate you toward achieving them. Setting and following a budget may be a challenge at first, but you can quickly learn to live below your means. As trends in the economy evolve, so should your goals and investment portfolio.
Don’t be afraid to take calculated risks to build your accounts and always talk to your partner about any changes.
Be sure to submit questions to The Triggator Podcast and our team will teach you more about investment strategies and growing wealth!
In January 2022, the average American household owed $155,622 in debt. This number included credit card debts, car loans, and mortgages, to name just a few of the most common expenses. And if you're like most Americans, six figures is often the point where debt goes from manageable to intimidating. What if we told you that debt payoff could be as simple as logging on to your computer and pressing a few buttons?
How would your life change if you never had to live from paycheck to paycheck ever again?
Budgeting tools aren't just a nice idea — they could be your ticket to becoming debt-free in record time. Want to learn how? Keep reading to find out.
Love him or hate him, Dave Ramsey has created a pathway to financial freedom that has worked for millions of people. Dave Ramsey’s baby steps were created as a guide to help rid people of the burden of debt while building wealth for the future.
If you’ve started his baby steps, but could still use a little help, Triggator’s online budget app is completely compatible with Dave Ramsey’s process and will help you on your journey to becoming financially independent.
Here’s how Triggator can guide you through the baby steps.
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