Financial Freedom Roadmap – Have you ever heard the term financial freedom or... financial freedom? Financial freedom meaning that you have enough money to meet the financial needs you want, without depending on your main income and other people.
Everyone wants to achieve financial freedom (financial freedom) at some point in his life. We no longer need to be afraid to meet the needs of daily life, because after reaching the point of financial freedom, these needs can be met only from our passive income.
But make no mistake, the way to financial freedom very long and steep. Of course it requires patience, strategy, and hard work too. We need a timeline or roadmap mature and structured to achieve this. However, there's no need to worry, you can start achieving financial freedom by compiling financial freedom roadmap.
What is the importance of compiling? financial freedom roadmap? Financial freedom roadmap gives us information about where we are now and how far we have to go to achieve financial freedom.
Before compiling a financial freedom timeline, you must pay attention to the following 5 elements!
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5 Elements to Consider Before Creating a Financial Freedom Roadmap
1. Expenditure Flow
The first step that we need to consider before compiling a timeline is the flow of our expenses each month. We must see what needs are mandatory expenditures and record them.
It is important to be able to strategize how much income we need, so that we can choose the right investment and the right side job.
2. Inflation Rate
The inflation rate will have an effect when you make financial plans in the future. You must be able to take into account the possibility of inflation that will occur in the future. Therefore, you must exaggerate budget that you make in your financial plan.
In addition, inflation can also affect the investment choices you choose. Make sure you have some form of investment that is not too affected by inflation. You can consult a financial expert about this.
3. Rate of Profit from Investment
Just like inflation, we must also be able to predict the level of profit that we will get from investment. Make sure the profits that we will get continue to grow and can meet our financial needs in the future. The importance of choosing the right investment also plays a big role in this element.
4. Age
We must be able to take into account the productive and non-productive age. The reason is, at a non-productive age, our chances of working are small. Ideally, at a non-productive age, we can enjoy the benefits of saving or investing in productive times.
5. Total Savings
The last element, namely the amount of savings. This element is important because the greater the amount of savings you have, the greater the opportunity to allocate investment and insurance funds that you can spend.
Those are the 5 elements you need to pay attention to before compiling financial freedom roadmap. Next, there are 6 tips for compiling financial freedom roadmap from Whiz that can make it easier for you to achieve financial stability!
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6 Tips for Compiling a Financial Freedom Roadmap
1. Record and Monitor Financial Condition
Record monthly expenses and income, then divide them into categories. Based on these notes, you can know where to start. Do you need to cut expenses or not, need to change the type of investment or not, etc.
After that, keep an eye on your financial condition, don't let your expenses exceed your income. This method is also effective to always be disciplined in allocating money.
2. Create a Long Term Financial Plan
Make a long-term financial plan, note what things will later cost money and cut things that are not important so that you can save expenses.
Examples of future fixed expenses include plans to buy a house, marriage, taxes, children's education, and retirement. You have to start planning how much it will cost and the deadline.
3. Pay Off and Avoid Debt
In order to be financially free, you must also be debt free. If you use a credit card, or have other forms of debt, pay off all these debts as soon as possible. Next, stop using credit cards because it will potentially increase debt and interest.
4. Cut Expenditures and Increase Income
Previously you had to record monthly income and expenses. That way, you can find out what expenses really have to be paid and which ones don't. Cut these unnecessary expenses and divert the money to other sectors that can generate benefits, for example investment or savings.
In order to allocate a lot of money to the investment and savings sectors, you need to increase your income. Start looking for a side job or business that matches your skills.
5. Investment
Determine what investment best suits your financial situation. If you are still a beginner in the investment world, you can start by learning the basics through books, seminars, professional classes, etc.
You can start from investments with a low risk level such as mutual funds, or you can buy gold bullion as a form of saving money that avoids inflation.
The greater your income and your broad knowledge of investing, you can venture into high-risk investments such as stocks, crypto, or property business.
6. Manage Passive Income
The last tip, which is to manage passive income what you get from your investment. It would be better if you could turn the passive income into a business that will return to profit.
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Example of a Financial Freedom Roadmap
Whiz has an example of a 4-year plan to financial freedom that you can follow. Here's an example!
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So 6 tips to compose financial freedom roadmap from Whiz. Come on, apply immediately so that you can become financially free and can enjoy life without worry!
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