It’s easy to say that you want to become a millionaire. It’s also easy to imagine yourself as one. But daydreaming of it alone won’t attract that kind of destiny. To draw the energy of wealth, you need to take steps to financial freedom.
Often, financial articles and books tell people to strive to become a millionaire by 30. But in today’s economy-not to mention the COVID-19 pandemic-it has become unrealistic to achieve that. Plus, you shouldn’t pressure yourself to accomplish something remarkable-money-wise, at least-at 30 years old. If you’re young, you can dream like you have all the time in the world. But that doesn’t mean you can’t take baby steps to achieve financial freedom.
By setting these goals, your journey will start to feel real and progressive:
Table of Contents
1. Increase Your Savings
Aside from just saving money, strive to increase what you save over time too. If you save $5 every week, make it $10 sometime in the future. Growing your savings strengthens your financial discipline.
Of course, to increase your savings, you have to decrease your spending too. If you spend more than you save, find out where most of your money goes. If they only go toward unnecessary stuff, scale down your shopping habits. But don’t expect yourself to change overnight. Adopting a new saving strategy will take time to get used to. Just keep your eyes on the goal and avoid the temptation to relapse.
2. Reduce Your Debt
Good debts, such as a mortgage loan or a business loan, won’t threaten your financial freedom. But credit card debts and personal loans might do.
Before buying anything with your card, ask yourself if you need the purchase. The saying “If you can’t pay in cash, you can’t afford it” is true in many scenarios. After all, you’re buying with money you don’t have.
It’s not always bad to spend using credit. But if your credit card debt is starting to affect your saving targets, you might have a problem already. If it gets to a point when you can no longer pay your debt, your banks can freeze your cards, and your creditor may sue you. The same can happen if you fail to pay other personal, unsecured loans.
So as early as now, develop a payment strategy that will relieve you of debt. When you retire, you shouldn’t be paying any debt already.
3. Grow Your Income
Money may not be an indicator of success, but it sure is an indicator that your value in the workplace is increasing. The better you get at your skills, the higher you should be paid. And the more complex your job becomes, your paycheck should also grow.
You don’t need to pursue higher education to boost your skills unless your job requires it. But in most cases, experience is the best teacher. If you’ve been working in the same company for many years now, your skills today are no longer the same as your skills on day one. So try to ask your management for a pay increase if you think you’re due for one.
Working extra hours may also help, but overworking is hardly a solution to a small income. If your career progress is stagnant in your current company, consider looking for a new employer with an offer that suits your credentials.
4. Invest in Long-term Securities
Instead of just letting your money sit in a savings account, invest some in securities. Go for moderate-risk ones, like a long-term bond index fund. Moderate-risk securities yield higher returns than low-risk securities. The only downside is the time it takes for the money to mature. Long-term securities, as its name states, put your money on hold for at least five years. You can make a withdrawal before its maturity, but you’ll get the best returns if you wait for the actual maturity date.
If you invest in long-term security now, chances are they’ll mature shortly or just in time for your retirement. By that time, you can already have millions. You can reinvest the money or enjoy it by buying a retirement home and going on many holidays.
5. Have an Estate Plan
Contrary to popular belief, estate planning isn’t for the rich only. Everyone with assets, no matter how small, should do it. An estate plan will ensure that your assets will be taken care of when you pass on. And you don’t have to be 65 to do it. You can start planning your estate in your 40th.
These financial goals will help put your life together and allow you to see a brighter future for yourself and your family. Start accomplishing them as early as you can.
