Financial Independence… Myth or Possibility?
A Firstline Securities Limited Blog by: Renata Girod
I cannot say that I know one person who would not want to be able to live life with sufficient income that can adequately cover their expenses, without depending on a job.
I believe most of us dream of attaining that seemingly elusive state of financial freedom like my cousin who just started working, my sister who has a small nest egg, my middle-aged neighbour who has just built a studio apartment for rent, or my brother-in-law who is saving a small sum with three financial institutions. Do you think financial freedom is possible for them?
Those of us with that burning aspiration often think of successful businessmen, actors and innovators and how can we achieve the success they have, that is, become wealthy and financially free. We tend to think financial independence is just for the wealthy but it’s not!
Amassing wealth and becoming financially independent is a process that takes time, dedication and work. It does not happen on its own: it is a journey. As a colleague recently told me, “it starts with paying yourself first.”
Here are 3 tips you should try to remember:
- Seek out ways to get more money
- Invest in assets that pay YOU
- Continuously build on your investments
- It may be tough, but you need to tighten your belt. Don’t just say it – do it! For example, do you really need to buy lunch every day?
- Increase your income
- Ask for a raise
- Seek higher paying opportunities (pursue educational courses to help you)
- Start a small business
- Do part time work
- Open Savings accounts with no/ low monthly fees
- Avoid loans as much as possible
- Start while you are young: you tend to not ‘miss’ the money and it accumulates quickly
- Aim to save 50% of your salary every month
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Invest in Assets that pay you.
Use the money that you have saved from ‘escaping the trap’ to start building your investment portfolio. Building an investment portfolio may sound complicated but it’s actually quite straightforward.
- Walk in or call different financial institutions and speak to their financial advisors: find out what are the best returns they can offer you
- Work with a Financial Services firm, such as Firstline Securities Limited
- Talk to your colleagues, friends and family about where they are investing
- Learn on your own
- Open mutual funds or fixed deposits that pay competitive rates of interest.
- Open accounts that invest in stocks and bonds and pay dividends.
- Invest directly in stocks and bonds through a broker/ dealer.
- Invest in tax free accounts (retirement plans)
Continue to build on your investments: As the money you are saving starts to accumulate, it’s wise to begin investing on a larger scale. Use your growing cash to:
- Start up or expand your business
- Build a home extension for rental income that can be reinvested
- Make a down payment on/ or purchase of an investment property
- Invest in larger, slightly riskier investments. They will carry more attractive returns
- Keep investing and re-investing over the long term
- Stay abreast of what the market is offering
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Financial independence is attainable with the right planning and dedication. It would not be quick, but if you start now and work with the right financial partner financial freedom can be within your grasp.
(1 868) 628 – 1175/1554.
