The concept of freedom, and more so, financial freedom has taken many shapes in the 29 years of our democracy.
As we approach and commemorate Freedom Day this month, let’s explore what it means to be financially free and what we can do to achieve it.
Financial freedom means something different to everyone, but most of us would agree that living comfortably and having enough money to keep a roof over our head, put food on the table for our families, and send our children to school are at the top of our list to meet our most basic needs. Having financial freedom offers a sense of security and peace of mind, that gives us some assurance in uncertain times, that we have better control over some of the things that happen in our lives. Granted, we can’t control everything like the rise in the cost of living or keeping the lights on, thanks to Eskom.
To achieve financial freedom, it's important to develop good financial habits such as creating a budget, living below your means, saving regularly, and avoiding debt. It also requires a long-term commitment and the discipline to stick to your financial habits.
It’s been said “it takes 21 days to form a habit and 90 days to make it a permanent lifestyle change”. A full year is 365 days so that gives all of us grace to improve our financial literacy and get better with the discipline.
Here are 5 steps you can take to get started on your journey: Set financial goals
Start by setting specific financial goals for yourself; both short-term and long-term. This could include things like paying off debt, saving a deposit for a house, building an emergency savings fund, or saving for retirement. This exercise doesn't have to be pressured and there is no right or wrong way; just a method that gets you started.
Create a budget
A budget is a fundamental part of managing your money and achieving financial freedom. It will help you track your income and expenses and ensure that you’re living within your means. You can use our budget calculator to get started.
Whether it’s saving for your retirement, towards your dream home, or for your rainy-day fund, make a habit of saving money every month, even if it's a small amount. Over time, these savings will compound and grow, helping you achieve your financial goals.
Live below your means
Avoid overspending or getting items on credit. The journey is always easier when you live within your means. Getting the latest cellphone or a new pair of sneakers may feel good now, but will it really help you to achieve financial freedom? Cut unnecessary expenses and focus on the things that truly bring long-term value to your life.
Speak to the experts
You don’t have to tackle the journey alone, speak to a Metropolitan financial adviser who can help you work out a plan to achieve your financial life goals. Your adviser can also help you empower yourself with tools to make smarter decisions.
Remember the road to financial freedom is a journey and not a race. It is the freedom to make choices. It taps into all people; regardless of circumstance, having the luxury to make decisions fit for them and their future. By developing good financial habits and sticking to your financial life goals, you will be in a better position to achieve financial freedom and have the life you dream about.