Today I want to give you some simple steps that you will need to take to create financial freedom.
Firstly I will need to bust a myth.
To be financially free doesn’t mean you need to be a millionaire. It simply means that you need to be able to pay for the cost of your living needs from a/several sources of passive income.
Basically it means that you’re no longer paying for your needs with money that you had to work for. Instead you are using money that is working for you, to pay for you to live.
So what are the needs? THis is the next where people get caught up. When they are thinking financial freedom, they are thinking of this lavish lifestyle that they want to live down the track – hence the thought that they need to make such large amounts of money.
That is not the case.
When we think of “needs” that need to be paid for – we’re looking at your current needs (and basic needs at that).
So it means simply to be able to cover your housing cost (in the house you’re in right now or similar), your utilities, your education, food, transport (and not in a merc, but in your current car) basic clothing that you would need to work.
What you need to do is basically sit down and add up all of these things. If you’re not sure where to start, I have included a budget at the bottom of this post for you to download and utilise.
Then you need to devise a plan.
How are you going to create a passive income (or several sources) to cover these costs.
When you’re looking at these costs – you will see that you’re not going to need a large amount.
In Australia you can quite comfortably live on about $30,000 meeting your needs. That obviously doesn’t include going out, partying, holidaying etc – just to have your basic needs covered. $30,000 is roughly the current cost in 2017.
So now its time to devise a plan to make $30,000 per annum.
So what is Passive Income? That is income where you exerted yourself in the beginning and after that time, you can let it run by itself with minimal supervision to create money for you.
The sources you can utilise include various businesses (online or brick and mortar business where you don’t have to be there), shares, bonds, term deposits (although the current interest rates are rather crappy at the moment) and you can even use property. There are various ways you can use property. Some you don’t have to save a massive deposit to get into the market but be sure to research the options.
Pick ou the one you understand and you feel comfortable with the risk you have to take and start putting your money towards it.
That is your basic action item.
1. Research how you’re going to do it.
2. Take action right now.
Financial freedom doesn’t mean you’re going to live a lavish lifestyle it just means that you are able to cover your needs and not having to work for those dollars.
It doesn’t sound that overwhelming straight away!
Now go ahead and make it happen 🙂