Everybody who gets out of bed each morning to earn a living has the goal of becoming financially independent. While many people may never achieve financial independence because they are not intentional about it, others take the required steps to do it as soon as feasible.
However, since we are all plagued by future uncertainty, the need to become financially independent becomes more pressing daily. And attaining it means you can easily afford life’s basic amenities and indulge in other luxuries. Most importantly, it would allow you to weather the inevitable financial crises that come with inflation and other economic pitfalls.
In this interview, finance pro, Lance Ippolito, has some tips on things you need to do to attain financial independence.
How challenging is it to become financially independent?
Like everything in life, being financially independent does not come easy. Only very few people attain it quickly due to some stroke of luck, while the majority have to go through immense handwork, risks, and discipline to pave their path.
What advice can you give to individuals to help them become financially independent?
A key step to achieving financial independence is having the right mindset. I tell myself each day, “Lance Ippolito, there is nothing too great for you to conquer.”
With that mindset, I am moved to look for suitable means to increase my financial worth from its previous value. In addition, investing surplus funds, taking upside hustles or starting a business, saving passionately, increasing financial knowledge, and staying away from bad debts are all necessary for attaining financial independence.
Does debt prevent an individual from attaining financial independence?
Debt can be good or bad. Some people incur debt to buy new vehicles, jewellery, and other items that they cannot now afford with their income. Such actions would derail even the best-laid intentions to achieve financial independence.
However, debt can help you reach financial freedom quicker when appropriately utilized. If you take out a loan to invest wisely, the returns would both help you pay off the debt and give you money to reinvest or save.
Are there any investments that guarantee financial independence?
Investing your money has the potential to bring about significant gains, making it an essential step on the road to financial independence. However, there are no guarantees as every investment has a certain amount of risk.
Investments like high-yield savings accounts, Certificates of Deposit (CDs), Money Market Funds, Government Bonds, Corporate Bonds, Index Funds, Exchange-Traded Funds (ETFs), and Mutual Funds are safe.
They will produce some profits, though it might not be significant.
Also, if you are more adventurous, cautiously dealing in cryptocurrencies or forex can help you get your big break quicker.
Can reading finance books help better one’s chances of attaining financial independence?
Readers are usually more innovative and creative than other people. Reading financial books would help you understand the process of making money, give tips on suitable financial investments, and show you the mistakes to avoid.
With proper knowledge, achieving financial independence and stability becomes easier. Other steps you can take are:
- Setting life goals,
- Making regular budgets, for instance, monthly budgets,
- Living below your means,
- Setting up automatic savings, and very important,
- Getting a financial advisor.