Financial freedom is a long-term goal that requires years of consistent efforts. Many people lose motivation because it can take forever to feel some progress. Therefore, finding a measure to keep track of your progress and use it as fuel for motivation is essential.
You can divide your ultimate target into small goals to enjoy success now and then. Completing each goal will increase the hunger to achieve more within the limited time frame. However, the goals should remain reasonable since they will lose their purpose if it takes them forever to achieve.
What are the money goals to get freedom in your financial life?
Here are eight money goals to add to your checklist if your ultimate goal is financial freedom.
- Savings Goal
A savings account is your assurance against possible financial troubles in the future. You don’t have to rely on credit cards or loans to sail through tough times. Therefore, create a plan to increase your savings with some budget cuts.
An average adult should have an amount equal to 3 months of pay in their savings account. You can use the 80/20 formula to save money, where 20% of your income is directed towards an emergency fund. Use automated transactions to prevent the temptation to spend use the amount for the fund.
- Food Budget
Food is an essential expense in the budget with significant unnecessary spending. By creating a diet plan, you can save money and maintain a healthy lifestyle. Finding the unnecessary costs in your food expense will not take more than a few minutes.
Cut your frequent visits to restaurants to reduce your bill. You can easily make healthy lunch at home with the help of some YouTube videos. Stick to the list while visiting the grocery store, and do not buy items based on impulse.
- Clean Energy
You are not the only one affected by the energy consumption at your home. The environment is running out of resources, and the pollution level is increasing daily. It is time to help the planet while trying to save money by opting for energy-efficient alternatives.
You can install a solar panel on the roof based on your location for free unlimited supply. Smart devices take care of energy consumption with some inbuilt power-saving features.
Surely, you would like to have those devices in your home. Hold on! Do you have enough money to purchase them? If you have, then it is fine. Otherwise, what to do? You can go for borrowing options as there are many short-term loans available.
Of course, there will be many advantages in getting funds, but most lenders prefer those with good credit scores. If you have a poor credit history, you need to work hard to get the loan options.
As an alternative, you can take very bad credit loans to buy these products as an investment to save money and the environment. The interest rates may be higher, but you get the amount despite an adverse credit score.
- Transport Cost
Your strategy to save money on transportation will show progress from day one. And it is easy to figure out some methods to reduce the overall progress significantly. Therefore, it should remain your go-to option to save money on daily expenses.
You can start carpooling with your neighbours to commute even twice a week. Select electric vehicles instead of gas to save money on fuel. Or, you can use public transport and use the time while travelling for some productive tasks.
- Unnecessary Expenses
To control your budget, you must cut unnecessary expenses from the list. It may take some time to settle down without the amenities in life. But it is worth the trouble for the ultimate goal of financial freedom.
Make a detailed list of expenses before creating the budget for the next month. Divide them into two columns, needs and wants. Be honest during the process, as people often find unreasonable excuses to put some luxury expense on the need list.
- Increased Income
Limited income is a significant reason for the unsuccessful attempt to complete a financial goal. You can gradually increase your income to manage essential expenses and achieve saving goals. A side hustle is all you need to earn more money apart from the regular job.
You can also increase your income by progressing in the job with the right strategy. Increase your skills required to complete the critical tasks at the office. Do not waste time on tedious work that can easily be designated or left to procrastination.
- Repay Debts
Financial freedom is a distant dream if you have a long list of outstanding debts in your credit profile. It is time to create an effective strategy to repay debts faster. It will help you save money on interest and open some space in the budget for savings.
Prioritise the debt repayment while creating a budget. You can pay the small debts to get a sense of achievement and boost motivation. While paying high-interest loans is recommended to save money.
You can use a debt consolidation loan to pay the high-interest loans and simplify the repayment process. It will be easier to manage a single payment instead of a long list.
There is no doubt that debt consolidation loans are a good choice to make. Do you have an adverse credit score? Apply for loans for very bad credit from direct lenders to get instant approval and fund disbursement.
These loans will come with higher interest rates, but getting funds despite poor credit will be convenient. Lenders do not want to give you a loan if you manage your current finances well and make all payments on time.
- Retirement Fund
No, you cannot save for retirement within a few months. It is a long-term process with years of consistent efforts to save money. However, you can start it now to reduce some stress from the future version of yourself.
There is no ideal age to start saving money for the retirement fund. You should start it as soon as the first paycheque is credited to your account. Remember, the house can have a mortgage, and children can get an education loan, but no bank will offer a loan to older adults with no source of income.
Lisa Ann has developed a well-experienced professional career. From managing the staff of more than 50+ loan experts at Fastmoneyfinance to boosting the delivery of various loan offers, she has acquired many challenging roles to come out with the best results for the company. Lisa Ann is a Senior Content Author and the Chief Financial Advisor at Fastmoneyfinance. To back her massive experience in the UK’s financial industry, she has the postgraduate degree and diploma in Business and Finance.