3 Necessary Steps to Achieve Financial Freedom Sooner than Later

Want to achieve financial freedom? Tired of having to work all the time, missing your nephew’s first bike race, having to tell your friends you can’t go to the Caribbean with them this year (or next year)?

Want to have the choice to be able to work or not to work? Be able to spend time on what you want to spend time on (traveling, spending time with family, reading great books).

Same here. Are you on the path to get there? I know I am and I want you on that path with me. 🙂

Let’s talk about the 3 steps to take to reach financial freedom sooner than later.

1-Find Your Financial Freedom Number

If you want to reach financial freedom then the first thing we have to figure out is how much you’ll need to get there.

The simplest way to figure that out is to take what you think your yearly expenses would be during the financial freedom years and multiply that number by 25.

This means you’ll be able to withdraw 4% of your money to live on during financial freedom.

If you’re not really sure what your yearly expenses would be, just give it a good guess. You can look at your current expenses and ask yourself, ‘Do I think I’ll need a little more or a little less or will they stay about the same?’

You can always adjust as you go along, but let’s just find a good starting point so we can move forward.

For example, if you think your yearly expenses will be $70,000 then multiply $70,000 by 25 and that would be your financial freedom number.

$70,000 * 25 = $1,750,000

Do the math for your own expense amount.

Now that we know what we are working toward, how will we get there?

2-Make a Plan

Know when you want to reach financial freedom.

The next step is to figure out when you want to become financially free.

Will it be when your 60? When you’re 45? In 10 years from now?

You decide. Realize, if you choose sooner than later, you’re going to need to get busy right away. And even if you choose a timeframe further out, it’ll be so much easier if you start sooner than later, like right now…

Depending on how quickly you can make money and how much you’ll be able to invest and what you invest in, you may need to adjust the date to be further out OR you could adjust the date to be even closer. 🙂

The sooner you start, the less you’ll have to invest.

Let me give you a visual on what I’m talking about.

If we start with $10,000 and invest $300 each month. At the end of thirty years, we’ll have $442,548.

Now, if we are hesitating or thinking investing isn’t a priority right now and we hold off investing for 4 more years, by using the $10,000 initial investment and still contributing $300 each month, we’d only have $323,058.

3 Steps to Financial Freedom - Waiting to Invest

That’s a difference of $119,490! What would you do with an extra $119,000?? That’s almost 2 years worth of our expenses. We could go on some cruises, buy some pretty sweet cars, start a nonprofit, there’s tons of things we could do.

So the sooner we start, the more we’ll have and the sooner we can reach financial freedom.

So take a look at this calculator and adjust how much you’ll need to be investing to reach your financial freedom number.

You can adjust how risky/aggressive you’ll be with your investments, how long you’ll need to invest, monthly contributions and your initial amount you already have to invest.

If we started with $10,000, were aggressive with our investing and contributed about $1,000 a month, we’d be able to reach our $1.7 million financial freedom number in 30 years.

3 Steps to Financial Freedom - To Reach $1.7 million

That might seem like a lot right now, but just remember, we can start with where we are now and move to work upward.

The most important thing is to start now.

So how do we start investing now?

3-Start Investing

How do we invest to make this financial freedom money??

I’m going to give you my top two recommendations to getting started.

Ready?

Me too.

The first thing is to get free money. I know you’re probably asking, ‘free money, I’ll take that, where do I get free money?’

So glad you asked. If you are working for a company that offers a 401k, a lot of times the company will offer a match in their 401k plan.

They’ll match the money you’re putting in up to a certain amount. That’s free money! They’re just giving it to you.

So, start investing by contributing to your 401k, at least up to the match so you can get free money!

The next piece of advice is to set up an IRA or Roth IRA. You can invest up to $5,500 each year. Setting one up is very easy. I’ll even tell you where to set it up, Vanguard.com. That’s where I have mine. Vanguard is a great company because they are owned by us (it’s shareholders), they have low fees and great funds with great returns.

And if you’re wondering what to put inside your 401k or IRA/Roth IRA, I can help with that. I have a simple program, Done For You Portfolios, where you fill out a quick, easy form and I send you back what to invest in. Super simple, super fast.

I want to be able to help you get started investing right away. No more waiting because as we talked about above, the longer we wait, the less money we’ll be able to make, the later we’ll reach financial freedom and the more effort and money we’ll have to put in.

I started a 401k over 15 years ago and was just as confused as you. Since then, I’ve done my homework. I’ve done tons and tons of research, worked with mentors that are successful in investing and have been able to make great returns on my own money. I’d love to help you do the same! I don’t have my own agenda like a lot of financial advisors, I simply want to help you get started as easily as possible and sooner than later. You can check out my super simple, super affordable ‘Done For You Portfolios’ here (there’s one for your 401k and one for your IRA/Roth IRA).

Recap

So what did we learn in today’s post?

  • How to figure out your financial freedom number.
  • Decided on when we want to reach financial freedom.
  • Looked at the online calculator and made a plan to get there.
  • First place to invest so we can take advantage of free money.
  • Second place to invest so we can make our money work for us.
  • Option of being given what to invest in for your 401k and IRA/Roth IRA so you can start investing right away and get to financial freedom even sooner!

How close are you to your financial freedom number?

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