A Blueprint for Financial Success
Society says it’s okay to constantly toe the line of being broke when you are young. During our 20’s, it’s important for us women to find ourselves, define our path, press forward, and advance our careers. At this stage of the game, it really is all about learning and accumulating powerful experiences, both work-related and personal. Can YOU relate?
HOWEVER, there comes a point, usually around the 30 year old mark, where being broke just isn’t cool anymore. Bills add up, which leads to increasing stress, and the newness of adult life finally wears off—forever!
There’s good news, though. With a bit of planning and discipline, you can develop a blueprint for financial success as soon you enter the working world, and if you follow the blueprint, you will be establishing a lifestyle of financial health, which will only serve to spur you on to pursue your dreams with great passion and energy.
Begin With The End In Mind
Your financial goal should be to create a passive stream of income that eclipses your monthly living expenses. This is the definition of retirement! So, as we get into the nitty-gritty here, remember that the ultimate goal is to build a reliable passive stream of income that eclipses your monthly living expenses. Have YOU thought about doing this? (Side note: if you need tips on how, just ask Nicole – the founder of this very blog! There are infinite ways to “monetize your passion” and make a plan B!)
In order to get ahead you have to spend less than you earn (easier said than done, right!?). Now, there are two variables in this equation: income and expenses.
The way to create true wealth and financial independence is to work toward widening the gap between income and expenses as much as possible.
Therefore, your personal blueprint for financial success should focus on not only increasing income, but also keeping expenses in check.
It’s time to eliminate every penny of bad debt. Once you are consistently earning more than you are spending each month, it is time to focus on paying down all of your credit card debts, school loans, department store cards, etc. You may want to consider debt settlement as well. Debt cripples you and it severely limits your financial freedom. As you begin to earn a decent salary, the temptation is to increase your standard of living. This is fun in the short-term, but in the long-term it’s a real killer.
Instead, you should direct every extra penny you can each month toward paying down your debts. Forget paying the minimum monthly payment on your credit card. Pay as much as you can afford every month until that thing is $0!!
Once you are steadily earning more than you spend every month, and then directing all of that extra cash flow toward paying off your debts, within a reasonable amount of time, you will become debt free. This is a great place to be. Now, however, the fun begins. Now you can begin taking all of that extra cash you have coming in every month and investing.
Start a Business
This is the single most powerful way to create real wealth. Do you have a passion or an area of expertise where you believe you could start-up a small business in order to create an extra stream of income? If you have a general business idea, but are afraid to launch out on your own, reach out to friends and find a partner. Starting a business is not only a great way to create true financial independence, but it is also an unparalleled learning experience.
Remember, true financial independence is a process that takes time, but if you build your financial future on a debt free lifestyle, you will be well on your way to achieving all of your financial dreams.
What tips do you have for those who are trying to build their financial future? What do you do to guarantee your financial security?