Financial freedom is the ability to make life decisions without being overly stressed about the financial impact because you are prepared. But there’s a catch—a money habit that might be holding you back, and it’s time to break it.
1. The Dreaded Debt Cycle
Let’s talk about that habit that’s as sticky as morning syrup—living in a debt cycle. It’s the most common barrier to achieving financial freedom. It’s easy to fall into the trap of buying now and paying later, but this habit can quickly spiral out of control. I’ve seen it firsthand when a client came to me, overwhelmed with credit card debt. We devised a plan to pay off the debt starting with the highest interest rates first, and today, they’re living a life free of credit card debt and full of possibilities.
2. Financial Freedom Requires Financial Discipline
Breaking the debt cycle requires discipline—a lot of it. It means saying ‘no’ or ‘not now’ to expenses that aren’t absolutely necessary. This could mean skipping that shiny new gadget or opting for a Airbnb instead of a luxury holiday. Remember, financial freedom isn’t about making big money; it’s about making smart money choices.
3. Budget Like Your Future Depends on It (Because It Does!)
Budgeting is the unsung hero of financial freedom. It’s about understanding where your money goes each month and making sure there’s more coming in than going out. A colleague of mine used to joke that budgeting was like dieting, but once he started, he found financial freedom—and he even managed to save enough for that dream fishing boat.
4. Invest in Your Financial Freedom
Investing is the escalator to financial freedom. But remember, it’s not just about throwing money at the stock market. It’s about strategic, informed decisions. Think Superannuation accounts with tax advantages, index funds, real estate, or even a side business. The key is to diversify and think long-term.
5. Guard Your Savings Like a Treasure
Savings are the buffer between you and life’s unpredictability. It’s also the seed money for future investments. One of my clients treated her savings account like an untouchable treasure. Even when tempted by sales or peer pressure, she stayed the course. Now, her savings have grown enough to fund her house deposit.
6. Embrace Financial Education for Empowerment
Knowledge is power, especially when it comes to financial freedom. The more you know, the better decisions you’ll make. I’ve always been a proponent of lifelong learning, and it’s thrilling to see clients who read a financial book begin to take control of their money narrative.
Financial Freedom Is a Mindset Shift
Financial freedom is as much about a mindset shift as it is about money management. It’s about prioritizing your future needs over present wants. It’s about looking at every financial decision through the lens of, “Will this bring me closer to or further from my freedom?”
7. The Power of Saying ‘No’
The power word here is ‘no.’ It’s a small word, but it packs a punch when it comes to financial freedom. Saying ‘no’ to unnecessary debt, to that impulsive purchase, to the things that don’t serve your financial goals, is saying ‘yes’ to your freedom.
Breaking free from bad money habits isn’t just liberating; it’s life-changing. It paves the way for a future where you call the shots, not your bills or your bank balance. Imagine a life where you work because you want to, not because you have to.
