4 tips to help you achieve financial freedom

Originally published by Cathy Sibanda

Man holding a bank card
Photo by rupixen on Unsplash

Anyone can achieve financial freedom. You can achieve your financial freedom by following these simple rules.

1. Be free from bad debt

The first step to achieving financial freedom is being free of bad debts. Bad debt is very expensive; this is evident with exorbitant interest rates. Credit cards are a very good example of bad debts. Be sure to eliminate bad debts at all cost more especially if you are prone to impulse spending.

2. Spend less than you earn

This is one rule that everyone must master to have a healthy financial life. Make it a habit. Let your finances be governed by a budget. Its not about how much money you have, but how much you save that matters. Always spend less than you earn.

3. Build an emergency fund

An emergency fund or safety cash net is money that you set aside for emergencies. Initially emergency funds were created to be used when one gets laid off work. So basically this is the money you set aside for unforeseen financial emergencies. The rule of thumb is that the emergency fund should have funds equal to 6 months of your monthly expenses. Focus on the end goal and build your emergency fund over time.

4. Build income generating assets

Assets assets and assets. Do your assets generate income for you? Income generating assets give you passive income. This is the money that you are certain to receive every month even when you are not actively working. Build your income generating assets. Be consistent, you will eventually reap your rewards.