Financial independence is something we all strive to one day reach.
The term can take on several meanings depending on where you are in your walk of life. It can mean becoming financially independent from your parents, being able to support yourself worry-free, reaching retirement or being able to cover all your living expenses. Wherever you are in your journey, here are some tips to help you get there.
1. Start with a Plan.
Having a plan helps to hold you accountable and make your goals feel achievable. The beauty of a plan is that you can look back to see how you are preforming to it and adjust. When you are reflecting on it ask yourself, was it easy to save as much as you did? Do you think you can save more and still live comfortably? This can be done quarterly, annually or as often as it fits into your lifestyle.
2. Avoid Debt.
Debt can be a scary word. We all know that we need to keep our debt as low as possible, but there are times in your life when debt may be inevitable. For instance, when you are buying a home or investing in your education. The important thing is to make sure your monthly payments are on time and if you get a little bonus in your tax refund or at work devote a portion to paying down those loans. Another great rule to live by is to not use debt to fund your lifestyle. Living within your means and staying on track with your plan can help you on your path toward financial independence. Here are some helpful tools to manage debt.
3. Prioritize Saving.
This concept may seem like a no-brainer but it can play a large role in your financial independence, especially later in life. One easy way to get this done is to have a portion of your pay check go directly into a savings account so you aren’t tempted to spend it. A common rule of thumb is to save 10-15% of your salary each year. To find more easy ways to prioritize saving, visit our Financial Independence section at amerisbank.com.
4. Cut Expenses.
Cutting expenses is always easier said than done. We all get used to our spending habits and don’t like to give up our creature comforts, but cutting expenses doesn’t have to be difficult. It can be as simple as cooking at home instead of eating out, grabbing your coffee at home instead of stopping for a $4 latte every morning or finding free community events to attend on the weekend for entertainment. Every little bit helps!
Investing is a great way to contribute to your financial independence in the long run. Options to consider investing in may be the stock market, bonds or even real estate. Take the time to research the assets you are thinking of investing in and pay attention to potential return on investment, the payback period and risk level associated with the investment. Also, consider consulting a financial advisor for their expert advice and opinion.
The information voiced in this material is for general information and is not intended to provide specific advice or recommendations for any individual.