9/1/2023 0 Comments Define financial freedom![]() ![]() You may be surprised at what you find when you take an honest look at the numbers. Consider writing down every dollar of income and expense from the past few months. ![]() You get the point: The goal is to identify which expenses might be preventing you from reaching your financial goals. This works out to $250/month or just about $8/day.Īnd what about the gym? Are you using it enough to justify the cost of membership? Ditto for various subscriptions and streaming services. ![]() How much do you spend on dining out or ordering in? The average American spends approximately $3,000 on restaurant meals and takeout every year. Would you consider living in a less-expensive home or apartment if it helped you build a financial cushion? Can you get by for another year or two without that new car? The answer may be yes or no, but it’s important to be clear about your options.įor categories where you have greater control, it can be helpful to review your spending habits for a better idea of where you can save. Reducing your fixed expenses could take time and involve major changes to your lifestyle, but it might be worth doing in your quest for financial freedom. Others are discretionary, like what you spend on clothing, entertainment, and dining out. Some expenses are fixed, such as your rent or mortgage payment, or a car payment. Part of your budgeting exercise involves identifying categories for various expenses. Understand your expenses - and your spending habits As you get more comfortable using it, you’ll know how to make reasonable adjustments and still stay on track. And keep in mind, a good budget is not set in stone. In your quest for financial freedom, a budget is your ally, not the enemy. If old-fashioned pen and paper don’t appeal, a quick online search will deliver a host of easy-to-use budgeting and personal finance tools to consider, many of them available at no charge. The good news for the resisters among us is that it’s never been easier to create a budget. For more than half of American adults, the prospect of setting up a budget is a hazy concept at best for some, budget is a cold, unpleasant word that implies hardship and no fun.īut without some form of a budget for reference, there’s no way to know exactly where your money goes each month. If you’re serious about achieving financial freedom, you’ll need to face up to the b-word: budget. Get comfortable with the idea of a budget Equip yourself to pursue financial freedom.Plan for bigger expenses, and set aside an emergency fund.Look at your debt with a clear eye, then make a plan to pay it off.Understand your expenses - and your spending habits.Get comfortable with the idea of a budget. ![]()
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