Ever since the colonial period, many individuals have always been after attaining complete freedom main a lot of sectors. However, if there is one sector whereby many have failed to achieve complete freedom it is in the financial sector. To start with, what is financial freedom?
This question has brought about a lot of fuss with different people having different definitions. According to wikipedia, “financial freedom is a well-planed lifestyle whereby one is not required to work in order to earn all enough income to cater for the expenses”. This is one of the major definitions used by most of the elites in the sector.
Another very common definition is one that describes financial freedom to be state whereby one’s passive and residual incomes are more than his or her expenses. This is the most reliable definition. It is more common among business affiliated authors such as Suze Orman who is the author of the book “9 Steps to financial freedom”.
Passive income is one that one gets from investments while residual income is one that one earns on a monthly basis from doing particular job. All in all, both incomes attribute to the total amount of money one gets at the end of the month.
No matter the amount of money you end up earning at the end of it all, all that matters is the manner in which you budget for it. The secret behind financial freedom is that you earn as much profit as possible such tat you can sustain yourself I n the time of need. This is where budgeting comes in. It should be done in such a way that the expenses are way below what you earn in the long run.
On the other hand, do not budget for all the money to an extent that your pockets remain completely empty once you buy whatever it is you had planned for. Cut down the cost such that you will still remain with some reasonable amount that if saved properly can be invested.
However, this can only be done under two conditions. Number one; get rid of all the bad debts. These are debts that just add up your cost. Deal with them first before anything else. Condition number two: get as many sources of income as possible.
The best alternative source is by investing more and at the same time building a job on the side. A very good example is home based network marketing that has no time limits and in addition to this you are your own boss.