What’s your version of financial independence?
Investopedia defines financial independence as having enough income, investments, and savings available to live the lifestyle you want for yourself or your family. Since everyone is on their own unique journey, financial independence can look different from person to person. And sometimes getting there can even feel daunting or overwhelming.
In this article, we will explore a few simple money tips you can start implementing today to help you reach your version of financial independence.
Money tip #1: Define your goals for financial independence
What’s your ideal lifestyle and how can your finances support that? Where do you want to be 5, 10, 20, or even 50 years from now? What kind of road blocks could stand in your way? These are just a few of the questions you need to ask yourself when defining your money goals. Consider creating a vision board and keep it in a visible place to give you direction and guidance!
Money tip #2: Budget wisely
Creating and managing your budget will be a huge component to achieving financial freedom. Budgeting allows you to understand the full scope of your finances, track your income and expenses, and ultimately identify where you can cut back on spending or places where you need to start saving more. Throughout time, you’ll want to adjust your budget to reflect your everchanging needs. Remember, if you need additional help staying on target, try our free budgeting tool, Money Management.
Money tip #3: Understand your credit score
Your credit score is one of the most important parts of your financial life and understanding it is just as important. There’s a lot of factors that go into your score and this breakdown can help you better understand each one. You’re entitled to a free credit report every 12 months from each of the three major credit bureaus: Equifax®, Experian®, and TransUnion®, so be sure to use this to your advantage! If your score is not where you want it to be, don’t fret! There’s plenty of ways to help you rebuild your credit score.
Money tip #5: Save for a rainy day
Throughout life, you’ll encounter unexpected expenses. Roofs leak, cars don’t start, and kid’s birthday parties will seemingly show up out of thin air. Are you prepared for these unexpected costs? If not, you may want to consider having an emergency fund on hand, which will give you peace of mind and allow you can continue focusing on your goals.
Money tip #4: Stay educated and keep learning!
When it comes to your money, it’s important to stay educated and keep learning as much as you possibly can. You’ll face plenty of financial hurdles throughout life, but you’re not alone. There are plenty of educational resources out there to support and guide you to financial independence.So, are you ready to get started? By applying these money tips and making them habits, you’ll certainly be on your way to your own version of financial independence!