The starting steps on the pathway to Financial Freedom

Posted by greg bryant on March 30, 2020

By Greg.Digital “Mr. Meditate & Motivate”

Peace to the tribe, welcome to the Holistic Hallway.

“Having money means nothing if you don’t know what to do with it” Greg.digital

What is financial literacy

Financial literacy is the possession of the set of skills and knowledge that allows an individual to make informed and effective decisions with all of their financial resources.

What is financial freedom

Financial independence (Freedom) is the status of having enough income to pay one's living expenses for the rest of one's life without having to be employed or dependent on others.[1] Income earned without having to work a job is commonly referred to as passive income.

For someone who wasn’t taught the definition of financial literacy growing up, seeing the words financial independence or financial freedom is useless. It is difficult to put into action until the context is put behind the words and the basic meaning is understood. Now that we know the basics, let’s start creating big and small goals. The ultimate goal could be saving for retirement, a house or a wedding. The minimum goal could be saving at least $20-50 per month. Let’s push towards a nest egg of $1,000 in savings.

Finding out where you’re currently at

Trying to make ends meet a lot of the times you’re not fully aware of how much debt you’ve accumulated over the years. Especially when you have credit cards, a car note, or other bills stacking up. It’s easy to fall into a paycheck to paycheck lifestyle if you live beyond your means or flat out don’t budget correctly. The first line of business is figuring out how much you’re spending on a monthly basis. One simple thing I do is add up how much I make within a month, subtract my current bills and what is left would be a base amount of what’s leftover or in a lot of times money I’ve wasted.

Pay yourself/ save money

If you have done the financial discovery process you’re ready for the hard part; facing the amount you see leftover. From now on try saving at least 10% of the amount remaining before you pay any bills. The golden rule is to save 20% but start light then gradually move up. The key is to get into the habit of paying yourself before you pay anyone else. You can create a free account with Betterment. There you can create a SafeNet, retirement, or start your path to wealth building. You can’t get ahead if you spend everything you make.

Use Cash. If Using Credit, Treat it Like Cash.

If you can physically see the money you’re spending, you’re less likely to spend it all. I realize when I use cash, I tend to hold onto it longer. If I have my card I swipe and swipe and swipe, in turn making it harder to keep my budget in mind. Some banks have a spending and budgeting section, including large banks like Bank Of America and Wells Fargo. If you’ve added up thousands of dollars worth of credit card debt and you can’t pay it back in thousands, at least slow it down. Only spend what you can pay back quickly. Pay them off as briskly as possible so you can start keeping that money for yourself.

“Nearly 70% of the U.S. population has less than $1,000 in their savings account.”

Live within your means

“If you can’t buy it twice don’t buy it”. I know sometimes we can get carried away spoiling ourselves and our loved ones a little too often. The newest shiny things are great until that feeling of “newness” wears off. Realizing you could’ve kept that money for a better purpose can cause you to feel guilty or in regret. Instead, you could opt to buy a course to learn a new skill or put funds towards something that brings revenue to you. Live within the new budget we have set. Keep in mind making more money means nothing if you’re not handling the funds the correct way. Being frugal is worth it when you have a goal you’re striving for. This is when “mind over matter” will have to be imprinted on your brain.

"53% of Americans are living paycheck to paycheck"

Find Additional Ways to Make Money

In the land of side hustles, you need multiple streams of income. We live in a time where you can make money for your business while sitting at your 9-5. A home-based business is great for tax benefits. Learn a new skill and earn an income from it. Figure out ways to profit off your passions. We all have something we’re good at or even passionate about. Gain a life of financial freedom off of the skills you’re passionate about. Making extra money means saving more money.

Donate monthly, quarterly, or yearly

Quick tip, when you donate to a 501 (C)(3) nonprofit organization, the IRS gives you that money back. I encourage family and friends who own businesses to donate to our nonprofit organization Photo Patch Foundation yearly. I personally make an effort to donate as well. Those funds are used to help those who are in need, not to mention they come right back to you. Money is a frequency that has to be recycled. You have to release it to receive it.

Zach, Jay Jay, Antoine, Greg

“It’s not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for.”

— Robert T. Kiyosaki

Key takeaways

Go over the budget and stick to it, get strict on yourself. Don’t try to keep up with the Jones’ or live beyond your means. Make sure you pay yourself before you pay anyone else. It’s not about how much money you make, but about saving some for yourself and emergencies. A side hustle is a necessity and can help with tax benefits. Donating to nonprofit organizations is like putting money on hold for the next year. If you have $1,000 in your savings account you’re not apart of the 70% that doesn’t have it in theirs.

Disclaimer

The contents of the Unlock Academy Site, such as text, graphics, images, and other material contained on the Unlock Academy Site (“Content”) are for informational purposes only. The Content is not intended to make you rich overnight. Always seek the advice of your finances advisor when investing your hard-earned money.