Moneycontrol
Aug 08, 2017 03:06 PM IST IST | Source: Moneycontrol.com

It is time to think financial independence

As we are all gearing up to celebrate our country‘s independence how about achieving our financial independence too.


Tarun Birani

TBNG Capital

In a few days from now, our motherland India will celebrate 70th Independence Day. Every Independence Day we remember sacrifices of freedom fighters who selflessly devoted their lives to achieve the goal of free India. Our independence was the result of untiring efforts of our leaders and many known-unknown men and women.

As we are all gearing up to celebrate our country’s independence how about achieving our financial independence too. Financial independence is about having the freedom to work or not work as you choose because you’re no longer dependent on income from working. It is the ultimate freedom everyone aspires to achieve. For financially independent people, their assets generate income that is greater than their expenses.

Let’s see what steps we can take to achieve financial independence.

• Free your mind from money worries:

Freeing our mind from money worries is the important step to achieve financial freedom. If we keep on regretting about past mistakes and worrying about our future financial state, we won’t be in a position to work towards our financial freedom.

• Setting up financial goals:

If we have taken care to list down our financial goals like retirement, buying a house and work towards achieving them we come closer to financial independence. Focusing on financial goals keep us away from following markets, worrying about what will happen to our money.

• Beware of impulsive shopping:

On the eve of independence, shopping malls start offering amazing discounts and most of us log on to e commerce portals in a mad rush to buy goods available. We must plan our shopping list and be ready to grab offers available rather than falling for impulsive buying. Our spending habits play an important role in adhering to our personal budgets which is the foundation of good finances.

• Start automating your savings:

Putting a certain date where money will be channelized to achieve your financial goals is one of the most powerful and effective way to build wealth and in turn earning much desired financial freedom. This ensures your money gets channelized towards your goals rather than just remaining idle or even worse getting spent on unnecessary things.

• Protect your independence from healthcare costs:

Importance of having adequate health insurance cannot be understated. You can do everything right to achieve your financial independence only to see your lifetime savings getting spent on healthcare costs. Apart from your health insurance some part of your savings can be directed towards building healthcare costs.

• Keep on reviewing your finances:

Achieving your financial independence is a journey. The importance of reviewing your finances on a regular basis is crucial as it gives you an idea of any amendment to be done on your investments or being ready to incorporate changes in your financial lives. Your portfolio should be properly diversified and importance of asset allocation cannot be overemphasized.

So this independence day, give some thought to your own Financial Independence, isn’t this the most ultimate freedom that everyone should strive to achieve.
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