If you are in a financial rut for a long time, here are some things that you can do to achieve financial freedom sooner than later!
- Determine a budget
Formulate a monthly budget and use this as a guide on how to live your life comfortably without overspending. Now is the time to get serious. Sit down with your family and develop a monthly budget that is based on your income, and not your overall monthly expenses (or think about getting extra income like ifttt seo).
The golden rule is never to spend more money that what you have under your name. Overspending is undeniably the major culprit as to why you are knee high in debt in the first place. Make sure that the income is greater or at least equal to your expenses.
- Set your goals
Set a series of financial goals that you need to achieve in a span of ten or fifteen years. Setting goals is one way of establishing independence in the near future. Keep your goals realistic and attainable. Write down your financial goals and rank them based on their relevance to you. Make sure to include short-term goals as well as these things will help you in prioritizing your needs and eliminate unnecessary spending altogether.
- Use cash and trash credit
Make sure to stop using your credit cards from now on. Credit cards are very convenient to use, but they feature interests and other fees that you need to pay off for many years to come. If you really want to be free from debt, make sure to use cash only or use your debit card for all transactions.
- Always have something left in your savings
You can start a savings by setting aside at least $1000 on your savings account. Work hard to start saving this much money and never spend it no matter how difficult life gets for you. You can however use it in emergency and urgent needs such as additional funds to repair your car or if you are in dire need of home improvement repairs. Never spend your emergency account for recreational purposes.
- Create an emergency savings account that is worth at least 3 months of expenses
Once you have cleared your name of debt, you may now go ahead and secure funds for an emergency savings account. If you are confident enough, you can allocate your savings to a money market account with substantial interest that is safe and easily accessible too.