Steps For Financial Independence

“I need to become financially independent, I need to earn.” The reason you may have had this thought may differ, but most of us have had this thought around the time we are turning 18. Many of us were still studying and couldn't really work full time or even part-time. Some of us wanted to do internships to make attractive portfolios, and have taste of the real world and learn practical skills, and some tried to save as much money as they could. However, most of the money we finally made would be spent and hardly saved, it was another part that we would feel better about not having to ask our parents for personal expenditure as we would spend our own hard-earned/saved money.

There's a famous quote by Warren Buffett “If you don't find a way to make money while you sleep, you will work until you die.” He is the same man who made $592,000,000 just in dividend income in 2017 from coca-cola while the CEO of coca-cola James Quincey's total compensation was $10,190,104.

I not implying that you should rather be an investor than a CEO, what I am implying is whether a CEO or not, you should definately be an investor, not all of us can become CEOs but each one of us can definitely be an investor. If you let me, I can help draw a path for you; first step- google what are shares, debentures, and crypto currency. Read about equities, commodities, bonds, mutual funds and everything you find. Now read some books like The Intelligent Investor, Rich dad Poor dad, Think and grow rich, Principles, etc.

Now it's time to work the theory into practice, open a demat account and decide if you want to start on your own or have a broker. Don't put all your eggs in one basket, don't shy away from being versatile. Always keep an emergency fund and an opportunity fund, an opportunity fund is a fund you keep aside so when you get great an opportunity to invest you have the means. Reinvest your profits. Keep aside a part in a savings account or a recurring account. If you have a lump sum save some money in a fixed deposit account.

The second thing to learn is the difference between looking rich and being rich. If you need to buy new phone list down what do you absolutely need in a phone, main features of a phone should be good RAM, good memory and good battery. If you need excellent camera then search a phone accordingly with other features you need, now list and compare all the phones that fit your requirement. If you trust the company and brand only then buy particular phone. Do not buy gadgets just for the sake of possession, buying the latest iPhone will do you no good, if you need convincing on why you are just giving away your money to capitalization by buying IOS instead of Android you need to really do your research. Prioritizing what's really important to you will take you a long way and investing in yourself will be the most important investment you will make. Study, keep learning, read as much as you can and keep upgrading and learning new and important skills. Stay updated, about market, science and technology. If you start with a new hobby do not immediately buy the top gears, give yourself some time, rent the equipment you need or buy second hand products, once you are convinced that you are totally dedicated to your hobby only then make larger investments in them.

The third thing is an important life skill to learn, making a budget, don't save what is left after expenditure; spend what is left after saving. Clear your debts as soon as possible. Credit cards can be very useful tools if used intelligently, be smart and don't abuse them. Make sure to invest in assets not liabilities, if you absolutely have to take loans be well-prepared. Think, don't try to multitask, you will do more work if you keep focus on one task at a time. Don't let social media and internet be a distraction, it's a wonderful resource, treat it as such. We need to remember that time is limited, it is the most important resource we have, so whether we use it or waste it will determine what we make of ourselves. Hopefully this article can be your first step towards your goal of financial independency.