“Financial independence is the ability to live from the income of your own personal resources.” – Jim Rohn
Financial independence should be the goal of everyone, but it is not going to happen overnight unless you win the lottery or get a big inheritance. You have to be patient and stay motivated until you reach your financial goals. But it is difficult to be patient year after year while you watch your net worth grow.
So the question becomes, how will you be patient as you work to achieve financial independence? Here are nine ideas to help you stay focused and give yourself some credit along the way!
Stay the course, even if the progress is slow
When your progress is slow (and some years it will be…), don’t make the mistake of changing your plans unless you know you’ve made a significant mistake. Stick to your original plan and remind yourself this is a process, not an event. It will be more difficult to measure your plan and progress if you keep changing things chasing after the next big return on your money.
Analyze what you have achieved
Speaking of measuring, take time to look at your progress and determine how far you’ve come. Even seeing small positive steps in the right direction is a reason to pat yourself on the back. Try to stay optimistic and look forward rather than behind.
Set small, realistic goals
Do a reality check with your goals. You can’t meet a big target like financial independence quickly if you’re living paycheck to paycheck. Scale back and create small wins by setting goals you can achieve within a reasonable timeframe and without creating too many struggles.
Investing is a long-term process
When you invest an amount, it won’t get bigger in a week or sometimes in a year. You need to give some time to your investments. What you’ve invested could even go down in a bad year, but over an extended time, it should rebound and grow.
Break it down
If your goal is to save $35,000 for a down payment on your home in 3 years, set a target to save about $11,666 every year. This is about $970 every month or $225 every week. It seems more achievable when you look at it in smaller payments! You’ll see progress which will help you be more motivated and patient to reach your goals.
Give yourself some credit
When you reach a goal, celebrate the achievement – however small it might be. Splurge a little and don’t feel sorry for doing so. This will help you stay on track until you reach your next goal and eventually financial independence. Just make sure you save your small splurges for these times only so that you don’t get too far off track with your goals.
Make it hard to get at your money
When you have to wait a long time to build wealth, you may feel tempted to spend money you’ve saved or invested on other things. If you have to save three years for that down payment on a house, don’t take the money out to do something different. Resist your temptation and make it hard to access the cash you are building up. That may give you time to change your mind.
Plan and save for your next big purchase
You can’t wait to make every big purchase until you achieve financial freedom. So, what can you do instead? You will have to be patient and plan your big purchases carefully whenever possible. Try to wait for the item to be offered at a discount. Watch for sales and set up alerts to let you know when the price has dropped. Ask at the store when the item might go on sale. You can also consider buying used for some items too.
Things might not go as planned
Even if you are managing your financial life well, there might be some emergency situations that stress your budget and emergency fund. You may even go into debt. Depending on the type of debt problems you’re facing, you have to look for options to solve your debt dilemmas and still remember you can have financial independence in your future.
You may have to be more patient than ever, but in time you can still achieve financial independence.
Article contributed by Good Nelly. She analyzes financial happenings and writes articles to help her readers plan for their financial future. She has been associated with Debt Consolidation Care for a long time, and she’s contributed her pieces to a variety of websites.