On India’s 75th Independence Day, take steps to achieve financial freedom
You needn’t be born wealthy to be wealthy. By managing money well and investing prudently, anyone can create wealth and achieve financial freedom. However, it’s not easy for everyone to curtail spending on today’s luxury for a prosperous future.
“Freedom as a concept has been defined and redefined several times in the past, and needs no introduction to the citizens of India. The famed stories from freedom struggles still live on, and ‘freedom’ as a theme reappears in our day to day lives, from stressful, unfair, discriminatory relationships with people, objects and institutions that stand opposed to ideas of progress and equality. Seventy-five years later, the modern people of India face new challenges that need addressing, educating and appropriate action-taking,” said Pramod Kathuria, Founder & CEO, Easiloan.
Kathuria gives his suggestions on how to achieve financial freedom:
Learn to manage money
A prevalent question concerning every salaried professional in today’s world is “How do I achieve financial freedom?” It may appear to be a simple, straightforward question, but financial freedom isn’t as easily attainable for everyone, as many of us can lack knowledge to identify the right approach towards a complex commodity like money. Financial freedom refers to the ability to sustain a quality of life ideal for an individual, free from debt and unemployment, with opportunities to add value and grow wealth. India currently ranks 121st on the Global Economic Freedom Index, a measure for the economic, political and legal institutions across different countries.
Assess your financial position and establish clear, flexible and tangible goals
Achieving financial freedom is multifaceted, and the different levels entail clarity over one’s financial position and possibilities, self-sufficiency from earning enough to support oneself, escaping the conundrum of living from paycheque to paycheque and creating breathing space, stability and flexibility to establish financial independence to move towards a position of abundance. Traversing the roadmap towards financial freedom can be complicated, and requires an individual to assess their financial position, establish clear, flexible and tangible goals which are short, medium and long term.
Generate passive income
Reliable investments to generate passive income and returns from mutual funds, stocks, gold and quality assets can be leveraged in pursuits of future independence, while tracking expenditure and proliferating income sources by up-skilling can also prove beneficial. All in all, an individual’s journey towards a place of freedom is not a simple one, but economic prosperity is a dream that can come true for anyone with the commitment and desire to achieve it.
“Financial independence is not just about making money, it is about how you manage it,” said Anil Pinapala, CEO & Founder of Vivifi India Finance.
“When you have earned enough wealth to pay for your living expenses for the rest of your life, it might be safe to say that you are financially independent. And that does not happen overnight. Working on a financial plan by utilizing various financial skills and following it with utmost discipline can help you achieve financial independence, where you will have enough money to face unforeseen expenses, fulfill your dreams and ambitions and live your life on your terms without anything holding you back,” he added.
Pinapala suggests the following ways to manage your finances that will help achieve your financial goals successfully in the long run:
Get your health/vehicle insurance in place
Medical emergencies, accidents, etc. are unexpected happenings that require us to be ready financially as the bills are higher. Having protection against these kinds of financial losses through insurance can help you tide over the situation and not be financially burdened after.
Make sure to save some amount
Saving money is essential to building wealth and reaching your financial goals faster. Apart from the daily expenses, monthly payments and investments, try to stash away some amount every month and whenever you can. This will help you be ready for unexpected financial circumstances or help with bigger investment plans in the future.
Invest wisely only after research
Understand the nature of thoroughly investments and assesses the timing of your investments in legitimate entities that are backed by a careful background investigation. Some of the investment options include – real estate, mutual funds, chit funds, recurring deposits, or fixed deposits.
“Also, understand that financial independence does not mean being debt-free. It’s okay to opt for credit, in fact, it brings discipline in repayments as well as in taking cognizance of your money in totality. A personal line of credit from registered NBFCs like FlexPay and FlexSalary can help you be prepared for unexpected financial expenses with their open-ended credit that offers flexibility in managing your personal loan and payments. All-in-all, your debt, your savings and how you manage them together will establish your financial independence,” said Pinapala.