Everybody is looking to obtain financial independence. Those who have made it feel the wonderful feeling that one gets out of knowing that you do not have to worry about money or looking at how much things cost. The minute you stop worrying about these things, then it is certainly an indicator that you made it. However, to get there is not easy. It will require hard work, dedication and most importantly self discipline. In this article I provide a few pointers on how you can attain wealth and get to that financial independence quicker. But be warned, it is not easy. If it were, then we would all be financially independent.
Save, Save and Save Some More
Every time I heard people say I can’t save because I don’t have anything left at the end of the month I basically translate this to I do not want to save because I rather spend my money now.
The only way you will build wealth is by implementing a rigid savings discipline. It is not about how much you save but about how often you save.
Let’s say after reading this post you open a savings account with $5,000 and invest $100 weekly for ten years. You invest it in an indexed mutual fund that is linked to the S&P 500 which has average a 10% return. How would that account look like in ten years?
Yes. With just $100 a week you have turned a total of $5,000 plus $52,000 in contributions into $102,793. Ten years go by quickly. Yes, you will have to give up some “fun” activities to save but that is the only way to get there. Start small and then challenge yourself by increasing the amount you save by 10% every month.
Eliminate All Credit Card Debt
The wonderful business of credit cards. I think it is the second-best business model after Uncle Sam. How can a company charge you 20% a year for a short-term loan that is sure not to go south. The only lending model that is illegal that comes close to these returns are the neighborhood loan sharks.
The credit card companies are not in the business of making you money or protecting your assets. They are in the business to enslave you and to use you as a pawn so you can go around flashing your credit card to a business. Guess what, the credit card companies win on two fronts. They charge you an interest, and some an annual fee, and then they turn around and charge the businesses a fee so that they can collect payment with the credit card. You want to have your business receive payments with a Visa, then you must pay up to Visa for that service. Then, if you as the consumer, do not pay your bill at the end of the month, they charge you an interest rate for carrying a balance. How nice is that. I am really in the wrong business.
How much money am I giving the credit card companies? Let’s look at an example. Let’s say you have a total accumulated $6,000 in credit card debt. The interest rate is 20%. It takes you three years to pay off that $6,000. Let’s assume you did not get any more credit card debt – Yes, I know that would never happen. Nonetheless, for the sake of the example, let’s assume that.
How pretty is that? You just gave the credit card company $2,027.33 for three years in interest. that is almost 1/3 of the initial credit card balance of $6,000. That is, of course, assuming you do not get any new loan balances added to the credit card or you do not go around getting more credit cards because you received a letter in the mail that tells you that you are “pre-approved” and you have to act now.
Now let’s see how long it would take you to pay off the loan if you pay less amount a month.
If you just send $144 a month on the $6,000 credit card debt it will take you 6 years to pay off that loan. Talk about working for the credit card companies. If you double that a month, say you send $305 a month and you do not, DO NOT, take more credit card debt, you pay off the balance in two years.
As you can see it makes perfect sense to start saving and stop carrying a credit card balance every month. People ask me how is it that I am able to live comfortable without having to worry about money. Well this is the first step. Stop spending your money on things that you do not need or do not bring you any additional benefit or value to your family or lifestyle. The credit card companies target impulsive shoppers or those consumers who are addicted to buying. There are people who get a kick out of pulling out their credit card and buying things, things that are meaningless.
Instead of getting a kick out of buying things you do not need using your credit card, why not get a kick out of every time you put money away in your savings or retirement account. Become an impulsive saver and not an impulsive buyer/spender.
Folks this is my first blog post of many to come. My vision is to help as many in the world as I can obtain financial independence and improve their lives. However, never forget that money and wealth is not the solution to everything. It is only a tool and a vehicle created by men to either enslave you or to free you. It does not in any way help you become a better person, a moral person, an ethical person or a person who believes and loves the gift of life from Jesus Christ, the Son of God. Money and Wealth will never, never replace the wealth of spiritual love. Never forget that as you embark on this journey of financial independence. If you do, you will be miserable. No matter how much wealth you accumulate, you will always have that emptiness in your life that no human-made thing on earth will fulfill.
This is my first post. I posted it on Independence Day, 4th of July, the same day I launched the blog. All in the spirit of hoping this blog helps you gain your financial independence.
Sincerely,
Economy Chief
What to read a brief bio of the Economy Chief? Sure. Click Here – Economy Chief bio.