Declare your pursuit to Financial Independence

This Independence Day, If you haven’t put yourself on a path to Financial Independence, take the first step and you won't regret it!. You would not achieve Financial Independence overnight, and you also do not have to change everything in your life today, but you have got to start somewhere if you want to be financially free..& today is a great day.

Some inspiring quotes of Financial Independence:

"There are many things money can buy, but the most valuable of all is freedom to do what you want and to work for whom you respect. Those who live paycheck by paycheck are slaves. Those who carry debt are slaves with even stouter shackles. Don't think for a moment that their masters aren't aware of it" - J.L. Collins,

“Independence, to me, doesn’t mean you’ll stop working. It means you only do the work you like with people you like at the times you want for as long as you want.” - Morgan Housel

I am also often asked, what does being financially independent means to me ? For me, It means to be free of the burdens of any kind of debt and having a portfolio of income generating assets that allows me to do what I want in life as opposed to living my life in a corporate cubicle. While it initially seemed quite difficult to achieve, but I was able to make it is possible with time, persistence and with a commitment to grow my income generating assets.

Today, I am sharing some of the key steps I took in my journey to achieve financial independence.

1. The first step I took was to create a budget. I took a look at all my household bills and calculated my expenses. Then I cut all of mine unneeded or frivolous expenses.

2. I cut down on my debt. It’s easier said than done, but by reducing my debt load, I had more money to invest for the future. I started by eliminating the smallest debts first, then moving on to whittle away at the bigger ones, till I became debt free.

3. I built an emergency fund containing six to 12 months’ worth of my living expenses, kept it in a liquid fund. Emergency can strike at any time in our life and all I can do about it is was to be prepared.

4. I was managing my money differently than my neighbours, family and friends. I was not impressing anyone with my Maruti Alto car or my modest home & lifestyle. I learned to delay gratification, and did not get trapped by an expanding lifestyle.

5. I took out time to establish a plan that can exponentially increase my chance of attaining financial independence. I wrote down all my goals and then constructed my asset allocation plan for achieving them.

6. My asset allocation strategy was born from my financial plan, which was able to balance risk and reward by apportioning the portfolio assets according to my goals, income requirements, capital growth requirements, risk tolerance and my investment horizon. It was unlikely that a single asset class would help me achieve all my goals.

7. I did not “over-focus” on my investment statements. Obviously, I wanted to know how my investments were performing. But I did not check on my investments every day, or even every week. I believed that if I pay extremely close attention to the movements of my investments, my emotions may lead me to make decisions based on short-term events rather than my long-term goals.

8. I planned for unforeseen happenings and got myself insured - medical insurance and life term insurance based on financial goals. Insurance is my ticket to safety and precaution.

Financial Independence is not a DREAM... It is a Decision. When I declared my financial independence, I had the power to make the rules that governed my life. It gave me the upper hand to negotiate things which are important to me like my working hours, vacations, family time, etc. It is allowing me to do my most meaningful work today.

It is time for you also to declare your pursuit to financial independence, on the day we are celebrating 75 years of Independence.

“It’s not just about investing. It’s about your life priorities and connecting your life to your finances to help enable those things,” - David Tyrie, head of Retirement and Personal Wealth Solutions for Bank of America Merrill Lynch.

(Photo by Ben Cheung from Pexels)