Becoming financially free by the end of the year is possible if you take control of your money and life style and stick to your intention as the highest priority. Even if you are in debt right now, with some planning, you can end the year with savings in the bank if you take time to do some financial planning now and make goals to help you achieve your objective.
- Begin by taking a personal inventory about the true state of your financial affairs as they look today. Create two columns and in one column list the money saved and assets you have available and your regular salary or other source of income The goal of financial planning is to be able to pay the bills in the second column from what is available in the first column and still save money
- The second step is to create a weekly budget. Base your budget estimate on your weekly income.
- Begin by estimating your weekly income before you pay bills or do anything else with your money.
- Put a minimum of 10- 20% of your weekly income before bills into a savings account
- Then work out how much you expect to need to pay in bills this month. Include all debts as well as utility and other bills you may have or expect to receive. Ensure you budget to pay more than the minimum amount on your debts. If you only pay the minimum required you will not achieve your goal of being debt free.
- Divide that amount by four and this will give you a weekly amount you will need to subtract from your income to cover your end of month bills.
- Allocate any remaining money for personal use, to increase bill repayments or to increase savings.
- The third step is to look for alternative income sources if your expenditures (not including personal use money) are greater than your income. This may mean taking a second job or looking for a higher paying job. Short-term pain will equal long-term gain.
- Stop using any credit cards and never use them to pay for food or clothes or utility bills. Repay them as soon as possible to reduce interest on repayments.
By focusing on these steps, your financial freedom by this year’s end is very achievable.