Financial independence is a very good feeling. Unfortunately, so many Australians today are unable to achieve it. Between the rising costs of living and the uncertain economic opportunities, people are lucky if they can pay all their bills by the end of each month.
If you want to advance toward financial independence and live a life where you do not need to worry so much about money, then you need to take certain actions and make certain changes to your lifestyle.
This will require you to change the way you think about money and necessities. Below are the top 7 tips for gaining financial independence.
Get a “Bad Credit” Loan
You do not need to let bad credit keep you down. If you are in a position where you want to fix your poor credit profile, then you can take out a credit card or loan and make payments on it. That is the first step to recover your credit.
You may be eligible for a loan even with a bad credit history. If you are willing to put up more collateral or pay higher rates of interest, then you can find lenders who will approve your loan application.
You must also prove that you are steadily employed and have a regular income.
The 50/30/20 Budget Method
The key to financial independence is saving money. To be successful at this, it is a good idea to create a budget which outlines where your money goes each month. It is recommended to create a budget by using the 50/30/20 method.
The 50/30/20 method is where you spend 50% of your income on necessities, 30% toward debt, and the final 20% on anything else you want. Try putting this 20% away into savings, or as much of it as you can.
Live a Frugal Lifestyle
Do you eat out at restaurants a lot? Do you purchase too many things that you do not really need? If so, then you need to stop doing that and only purchase the necessities that you need to survive each month.
If you have a surplus left over after you pay your bills for the month, do not assume that you need to spend all your money. Instead, save your money for an emergency or your retirement.
Frugal living means you save money and spend wisely. You do not necessarily need to be cheap all the time. Just do not splurge on luxury items with your money.
Buy Rental Properties
Real estate is one of the safest investments you can make with your money. If you purchase houses or apartments in desirable locations, you can easily rent them out and earn a nice passive income from them every month.
As your income grows, you can purchase additional rental properties and keep doing the same thing. That is why most real estate investors make their money and achieve financial independence.
Budget wisely as a family
This might seem like a difficult thing to do, but it is the best thing for some people who want financial independence. After all, it is very expensive to raise a family so having a realistic budget is an essential
Somebody who has a modest income can still achieve financial independence, whilst raising a family if you do not overspend and stay within your spending capability.
It may mean not having the ritziest house or the flashiest of cars, but if you are not burdened by debt then it is worth these small sacrifices.
Start Online Businesses
Starting a business is not expensive if you choose to start an online business. There are a lot of blog owners who earn more than $50,000 each month just by posting content on their blogs.
The overhead expenses are minimal too because you just pay to host the website.
There are so many profitable online businesses that you could start for little to no money. These businesses can earn you a nice additional income if you put in the time and effort.
You can sell products on eBay and Amazon or sell freelance services on websites like People Per Hour.
Superannuation is a special company pension program in Australia where you can invest your income into a retirement account and take advantage of generous tax savings.
If your company has this program available, then it would be wise to invest in it so that you can save money on your taxes.
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