Growing up we’re told that we need to save money so that one day we will be financially independent. However, there is quite a bit more to it than just saving money for a rainy day.
In this article, our financial advisors in Johannesburg have put together some of their expert tips for becoming financially independent.
What does your financial freedom look like in the future?
Without identifying the amount that you need to have in your bank account to become financially independent one day – how will you ever know what you are working towards? Work out how much you will need to be financially independent and use this number as your goal.
Working out your monthly budget is powerful. It helps you identify pointless spending and areas where you could save money. Draw up a budget and stick to it.
Additionally, by regularly checking in to see where you are with your monthly spending, it reinforces your goals and helps deter you from overspending.
Credit accounts are high-interest consumer loans that hinder your ability to build wealth. Always pay off your credit cards – not only does this help you avoid paying large sums in interest – it also helps you build your credit score.
Always pay yourself first. What does this mean? Well, make sure that you pay your retirement fund, unemployment fund, and savings first to avoid the temptation of spending this money.
Creating an automatic debit order from your account to your savings account, retirement fund and unemployment fund is helpful.
Look for investments that offer compound interest. This will help your money grow exponentially over time.
We’re not suggesting you try to become the next big stockbroker – This is where Olemera’s financial advisors come in. Contact us and we’ll help you identify investments aligned with your goals.
Always consider every purchase as a choice that you make to exchange time to be financially independent in the future.
How important is this purchase? Do I need it? Can I live without it? Can I find it cheaper somewhere else?
Keeping up with the Jones’ is a costly activity. Just because your salary has increased – it does not mean your expenses need to. Make sure to keep your expenses as low as possible and avoid lifestyle inflation.
Working towards your goal of becoming financially independent is great, but it’s important to look after your health along the way.
You want to be around to enjoy the financial freedom that you have worked so hard to achieve.
In every industry there are highly trained and skilled people. In the financial industry, financial advisors are there to help you navigate the financial world.
At Olemera, our financial advisors are ready to help you achieve financial independence.
Contact us for more information about our financial planning services.
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