Strategies for Financial Freedom: Goals, Intention, and Discipline

As we recently celebrated Independence Day, I thought of writing something on the “Freedom”. I’m sure most of us value freedom above everything else, and rightfully so. No one including animals and birds want to be inside a cage that curtails the views of outside. I wanted to club this freedom with another important matter for all of us i.e. Money. We all do something in our life in order to earn this very entity. Add Time to this mixture and it becomes the golden trifecta.

What is financial freedom? Why it is important!

If you value freedom then you know the crucial role money plays in terms of standard of living, taking care of loved ones, not compromising on the basic necessities (though different for different people, there are some common ones). Money belongs to the vast landscape of finance. Achieving financial freedom means you are not worried about your next paycheck/business order to live the life you think is the best for you. Be it spending time with family/friends, going on vacations, helping someone in need and giving back to society etc. You can start acting upon the goals, dreams that you had earlier without worrying about the monetary aspect of it.

Time: Everyone has the same 24 hours

Everyone has 24 hours. It is up to the individual to live/spend those hours in a way not to repent in future. One should do what they love then we can help build a stronger sense of self and society as a whole. Reality is different! because not everyone gets to do the things they love and have to compromise because of various reasons. This is where managing time becomes extremely important. Complete the tasks that you do not want to do first, if you keep postponing those then it just adds to the difficulty. Financial freedom helps us to delegate/outsource the tasks you do not like to do to certain extent. Time saved by this outsourcing can be used for something you like. Seems simple enough, isn’t it?

What can be done to attain financial freedom?

Goals. Intention and Discipline are the key ingredients.

Goals need to be very specific; this point is important. If the Goal is specific, then it is easy to pursue it and achieve it. Nothing fancy is needed to track the goals – a simple notepad and pen will do. Write down the goals that you have which you think will make you financially enough. Adding time horizon to the goals will definitely help improve the success rate. You can categorize the goals by the time duration needed. Daily goals, weekly goals, monthly goals, yearly goals and so on. One of the goals can be “Setting up an emergency fund” – As name says it is to be used only for real emergencies and not for the perceived ones. For example, meeting with accident is an emergency and not going on the ferry trip across ocean. As I said earlier, goals have to be specific so in terms of emergency fund, you need to ask do you already have one? If not do you want to build one? If so within what time you would like to build it? How much corpus it should have so on and so forth.

Apart from goals, Intention is the next important point. You should have the good intention to begin with. You need to encourage yourself and making the intention strong that one day you can achieve financial freedom. Intentions help you the way you spend your free time, if your intentions are about the freedom and that is what you work towards.

Third important thing I feel is Discipline. Easier said than done (trust me, I know). Humans are emotional beings, and we do not adhere to discipline unless it was forced upon us by someone. Be that someone for yourself. Anything ranging from saving, spending, investing, gambling can either become good or bad due to discipline.

Let’s take an example of budgeting and see how to involve above points into it. Budget in simple words is spending plans based on your income and expenses. Goal can be to create a budget. As most make some earning monthly – it can be a monthly budget. Intention can be to keep it as accurate as possible, as neat as possible and as unbiased as possible. For example, Spending on lottery tickets generally cannot be added as investments. Discipline can be making this budget month on month for a long duration to find patterns. For example, monthly budget for 12 months (1 year) to see how income, expenses pan out.

Money Management or Control

Sources of income like salary, daily wages, business, gains from investments should be tracked separately and accurately to help yourself to achieve financial freedom. If you do not manage money, then it will definitely rule you. A simple example of this is abuse of credit cards. Spending the money that you do not have is easy but paying it back is indeed difficult. Spend on your needs and things that can help you grow your income. For example, taking a course on something that you work on can help you with other lucrative opportunities. Similarly, you need to track expenses as well. This help if you need to worry or not depending on whether your expenses are overtaking income or vice versa. Another point can be debt management, paying off your debts with higher interests can be one the goals.

Investing for the future

Like ant’s store grains for winter, we must also save and invest for rainy days. Everyone should do this and learn about it. Inflation erodes value of your money year on year like a silent destroyer. Think about how much you are paying for a packet of milk now versus few years back. This is where one needs to learn about different asset classes which are available legally for investing. Like Stocks, Bonds, Mutual Funds, Bank deposits, Savings accounts, etc. Investing helps in creating a corpus for retirement as well when you cannot earn a greater income month on month. Investing comes with inherent risks so learning about those as well is an important aspect.

Lifelong Balancing act

Whatever you do, balancing is inevitable. Start making goals which help you in work-life balance. Do not listen to many high achievers out there who says work 80 hours a week. This is because imitating such success in different time period is extremely unsustainable. Make a goal about what is important for you. Becoming a robot to some extent in making bill payment helps as it avoids the emotional response to the rate increases by many governments, private companies. Learn technology whether you like it or not, this subject will definitely help you in the future to manage everything easily.

Freedom is very important for everyone, financial freedom can help you achieve the dreams, goals that your ha earlier easily without having to worry about where your next paycheck is coming from. Earn, save and invest for better future by learning and upskilling with a strong intention and discipline. Wish you all the best in your journey to the financial freedom hope you achieve it sooner than later.

Until I write again, take care