Financial freedom is one of the most desired wishes anyone has, and it is so for a good reason. You can never expect when there will be a financial crisis, sweeping away all your wealth and income sources. As a result, educating yourself about the importance of financial freedom, as well as the means to achieve it is very essential.
Robert Kiyosaki, an eight-grade dropout entrepreneur and investor, is one of the most popular financial literary activist and commentators living today. His book “Rich Dad Poor Dad” is rated as one of the best personal finance books of all time, and in it he details many ways to achieve financial freedom.
Here are Robert Kiyosaki’s 10 Keys to Financial Freedom:
1. Accept Full Responsibility
Every choice you make has its own consequences, some of which may cause damage to your wealth irreversibly. Hence, you must accept complete responsibility to secure your financial future. Understand that every decision and choice you make today will impact your life tomorrow. Therefore, it is essential that you evaluate all your financial decisions, purchases and expenses within the context of your long-term financial objectives.
2. Control Your Spending
We live in a consumer-driven world where we are compelled to spend continuously. Your spending habits are one of the main reasons why you won’t be able to secure your financial future easily. Track your every expense and think twice before making any purchase. It will be hard to do so at first, especially if you are prone to uncontrollable spending, but once you learn how to manage your expenses, then moving towards achieving your financial freedom will be a cakewalk.
3. Having a Budget is Crucial
Creating a budget and living within its limitations is crucial for achieving financial freedom in your life. A budget gives you the input you need to manage your income and control your expenses. In short, a budget gives you a sense of accountability. If you want to secure your personal finances, then a budget will provide you with tools to achieve just that.
4. Pay Yourself First
One of the key fundamental practices to achieve financial freedom is to work for yourself, rather than work for a bank or a credit card company. Learn to pay yourself first before you pay someone else. By doing this you achieve two things: you make yourself richer, and you stop getting poorer.
Only when you save money today can you invest it tomorrow, ensuring your financial freedom in the process.
5. Never Have Any Debt
Debt is one of the leading causes of financial insecurity in many people’s lives. It starts consuming you from the inside, stopping you from pursuing your dreams, hopes and goals in life. Debt deprives you of a happy future. Being debt-free should be one your unrelenting goals in life, and you should commit yourself totally to stay that way.
Debt-free living should be your passion if you want to achieve financial freedom.
6. Establish an Emergency Fund
An emergency fund is a cash cushion that will support your living expenses for at least 3 months. It can also come in handy when you need to cover unforeseen expenses in your everyday life such as repairs, medical expenses and other emergencies. Having an emergency fund is essential to make sure that you don’t resort to debt when such situations arise. Ensuring that your living expenses will be covered will also give you “peace of mind”.
One of the best ways to have a cash cushion is to set up an alternate bank account and start saving for your emergency fund.
7. Never Stop Learning
Educating yourself about financial matters regularly should be your top priority.
Today, there are countless sources to update your knowledge about the finance industry and how it works. Take full responsibility of your financial life by committing yourself completely to it. Instead of reading all topics in one sitting, you can start learning one subject at a time. For example, you can read about home budgets if that is what you are interested in. Likewise, there are many other financial matters that you can learn consecutively, thereby increasing your overall financial literacy.
8. Have Clear and Concise Financial Goals
If you don’t have any clear defined financial goals, then it will be very hard to work towards securing your financial freedom. If you want to establish a big business, work towards it by starting your own company. Alternatively, if you want to be an investor, learn to pick the right opportunities and grab them immediately when available. Only when you have your financial goals clearly in your mind will you be able to recognize your true potential.
Having goals and working towards them will also motivate you to life the life you’ve already dreamed out.
9. Network Marketing
The low startup cost of setting up a network marketing company is a great advantage to have. It is very hard to start a big business without huge investments and time.
A network marketing company will give you the time you need to build your business skills and transition from being a low-level employee to a highly paid businessperson. Hence, networking marketing is one of the perfect ways to secure your financial freedom. Network Marketing supplies you with a residual income, so you make money while you sleep and travel.
10. Simplify Your Life
Life is becoming more complex with almost every passing day. Running after money and your financial goals will distract you from things that are very important in life. As a result, you will start to lose your motivation and slump into the darkness. Hence, it is very essential that you simplify your life by freeing up your mind of all the clutter.
The key to financial freedom is very simple: convert your regular earned income into passive income or portfolio income. With this in mind, it is very easy to achieve the goals you desire without giving up on things that you hold close to your heart.