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Janine Do Cabo | Sustainability & Leadership Development | JHB, SA
8 things you can do to be IN10TIONAL about your financial freedom
Yes I said it, the BIG M-word! Everyone dreams of a holiday home at the beach, a game farm with a big bonfire, a favorite sports car, and not having to worry about looking for money when emergencies may arise. However, not many know what kind of sacrifices it would entail making that dream a reality. In a word, you need to decide to be IN10TIONAL. In my last article about IN10TIONALITY and how to be IN10TIONAL about your Happiness, I wrote about SAVING and how that can lead to a happier life. To give you a blueprint of what that would look like, here are:
8 things you can do to move in the direction of making your dream of financial freedom come true.
1. Define your long-term goals
Great things can be accomplished when you develop the vision you have in your mind into clearly defined long-term goals.
Be SMART about it. SMART stands for: Specific, Measurable, Attainable and Time-based
Specific – Defining your goals would require details. It’s the “how” you intend on reaching the financial goals you have in mind. There is an old proverb that says,
“A vision without a plan is just a dream. A plan without a vision is just drudgery…but a vision with a plan can change the world.
Measurable – As you head toward making your vision a reality, there should be progress that is measurable. On a week on week or month on month basis you should be able to see if your plans are heading in the right direction and if they aren’t, you should be able to change course.
Attainable – This should go without saying, but there are people who when trying to make their dreams a reality, set unrealistic goals for themselves – hopefully that’s not you. If you intend on paying off your debt, for example, focus on one bill at a time as opposed to everything at once. Another example could be that if you want to grow an additional stream of income, try not to spread yourself over many different projects. This only leads to non-productivity.
Time-based – Set a date to your long-term goals and tell it to your spouse or closest friend so that they can keep you accountable for when that date arrives.
2. Put money aside for an emergency fund
One of Dave Ramsey’s baby steps toward financial independence is to put money aside for inevitable emergencies that will arise. Emergencies like, an accident that may require medical bills that your medical aid won’t cover or something we all have recently experienced, a nationwide lockdown (COVID 19 related) which restricts or halts cash flow. They come when you least expect them and they have the ability to totally derail your budget. The goal according to Dave Ramsey should be to aim to save for an emergency fund of about R 10 000.
3. Pay off your debt
Student loans, house or mortgage repayments, and credit card debt are expenses that if you were to do the math, amount to a considerable amount that could be used toward setting up a successful financial independence strategy. When being IN10TIONAL about your financial independence, focus on paying your debt off with whatever extra income you may have before saving it, with the mindset that in the long run once your debt has been paid off, you will be able to save what you would have used for your bills. Giving you more money to either invest or save.
4. Develop a side hustle
The word hustle in the dictionary means fraud or swindle. This is not the kind of hustle that you should develop…
A side hustle is a colloquial term used to describe a job or business venture you’re able to do apart from your normal 9 – 5 full-time job that provides a supplementary income. In nature, it’s normally what you’re passionate about but when done well, it could assist in making ends meet.
5. Invest in your retirement
One of the inevitabilities of life is death and taxes. Another one is growing old. Since we are all headed in that direction, the sooner you can invest in your retirement, the better off you will be when that time arises. If for some reason your 20’s or even 30’s got ahead of you before you could start on that, then it’s not too late. Work out an investment amount to put aside based on the years that remain before you retire in order to have enough money to sustain you in your golden years.
6. Save for your children’s higher education
Waiting for your child to graduate from high school to start saving for their university/college education is way too late to open a saving’s plan. According to Old Mutual, you can expect to pay about R253 000 for a standard degree by the year 2035 – that’s excluding other expenses like books.
To secure the funds for your children’s quality education, it’s best to opt for a savings plan that allows you to put money aside from the moment they are born because small contributions add up over time.
7. Pull in the reins on your spending
If you remembered nothing else, remember this: LIVE BELOW YOUR MEANS! With the kind of society we’re in there’s so much social media pressure to “Keep up with the Kardashian’s,” – portraying a life of name brands and fancy cars which in reality isn’t affordable. If you IN10TIONALLY developed discipline in this area, you will find that you had more money than you thought you had – enabling you to do something more constructive with it.
8. Be IN10TIONAL about leaving a financial legacy for future generations
Making the ultimate goal to leave a financial legacy should be what drives when you struggle through having the discipline for saving or not spending money. Your future involves more than your own financial success and it should reflect on what you leave for your children and their children. Think generationally and in10tionally develop a generational legacy your grandchildren will be grateful for when you’re no longer around.
John Maxwell said, “You’ll never change your life until you change something you do daily. The secret to your success is found in your daily routine.”
If you put that principle into practice, you will be able to be IN10TIONAL about 1 of the 8 things you can do towards acquiring financial freedom, be it defining your long-term goals, being conscious about your spending, or developing a side hustle that works for you. If you need help with developing a plan for financial success, consider making the investment in a life coach whose main aim is to make you the best version of yourself!
Now this is a good time to say “Put your money where your mouth is” 🙂