Financial Freedom: What Prevents Us To Achieve It?

Financial Freedom As A Goal And A Way Of Life:

Financial freedom requires a passive income (those that do not require you to work) in excess of your daily expenses. Ideally, the passive income to cover all your current expenses and still means for saving and investment.

Regulation of financial freedom is very attractive because it allows longer work, or work on your discretion. In this case you are not worried about credit, currency, loss of employment and the ability to support their families and themselves, etc. Do you have a regular income, independent of and not requiring daily work, but providing you a decent life.

Beauty! So live is really great! But what prevents most people on the path to financial freedom? What are the main obstacles?

The Main Obstacles On The Road To Financial Freedom:

1. False beliefs and attitudes derived from their parents and society.

We are taught that the first thing young people need to buy an apartment and a car. This is the main indicator of a wealthy man and the family. According to him the success of parents estimate that surround people, colleagues, friends, etc. So we estimate our potential husbands / wife. It is also important to dress in the latest fashion, only brands, but also to go to prestigious restaurants, ski resorts and so on

Therefore, to buy an apartment and a car becomes a major program of action, at any cost. To do this, many borrow or lend money. Plus, the high cost of any excesses, without which it might well have been dispensed with, if there was a basic understanding of financial freedom and this freedom itself stood as a goal. Then have a plan of action and strategy would be completely different, and achieving financial freedom - feasible. But we just do not see this goal, and even more so, the way to achieve it. Other agenda and life! A pity ...

Financial Freedom: What Prevents Us To Achieve It?

Also, many believe that financial freedom is attainable only to those with very high earnings. But it is not so! Income - is only one of the variables of the equation! Much more important is how you manage money, how you configure your property / how and when making a key acquisition in life (apartment, car, house, etc.), how to save and invest money, etc. And another very important factor is time. If you're doing it right - working for you, and you will become easier, and if you do wrong - you become more and more difficult.


2. Lack of basic knowledge and understanding of the basic principles - how it works, how it should be arranged personal finances to secure financial freedom.

False beliefs and at the same time setting based on the lack of basic knowledge, as well as prevent them from finding and receiving. Many do not even think that can and should be different. And even if a person realizes that something is wrong, that there is some besmyslenno and hopelessness in the infinite earning a living in the ever-growing needs, rarely ask the right questions and looking for real answers - you need to put the right target.

On the other hand, would be knowledge - would be other purposes and beliefs. After all, if you understand the basic principles just to achieve financial freedom. To do this, just need to efficiently manage money (at the level of common sense).

3. Lack of faith / belief that financial freedom is attainable in principle. Man believes that understands and he believes his entourage.

If all share the belief that the apartment and the car at any price - the only financial goal in life is difficult for us to think differently. The more examples of people around who have attained financial freedom, the more information and knowledge of the person, the greater is his belief that to achieve financial freedom is not hard - you just need to understand how to do it, and do what you need (and it is very a).

4. The passivity and indecision, lack of preparedness and capacity to act. We are so arranged that act only in the direction of what we believe, and we understand, in the direction of our beliefs. It is a vicious circle that is easiest to break, having the necessary knowledge and to understand the issue.

What to do and what is the way out?

As you can see, everything is interconnected - attitudes, beliefs, knowledge and action. And you need to change the situation, just in reverse order starting with the understanding and knowledge that will lead to a change of opinion and further to the right plans, decisions and actions.

Step № 1. To study the basic principles of managing personal finances and achieve financial freedom. It is better to go hands-on training with a teacher, who himself reached similar results.

Step № 2. Determination of financial strategy - baseline optimization of personal finance to achieve financial freedom. It's simple, if you have the knowledge. Or need professional help to help paint the plan and put the correct target.

Step № 3. To live and act in accordance with the planned strategy. It is mainly about making the right financial decisions that with minimal effort, would lead to a situation of financial freedom.

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Why Is It Important To Manage Your Personal Finances

What does it mean - to manage your personal finances? Why is it important, and what you need to strive for? What are the main principles and approaches?

In the previous post I described the difference between financial success and financial freedom. Financial success is usually associated with higher wages and greater material goods at our disposal (and the need to constantly work to earn and even more). Financial freedom requires that your income and expenses are organized so that you do not have to work, and well-formed incomes allow you to live in dignity and not to worry about loans, foreign exchange rates, loss of employment, etc.

I am convinced that we need to strive not to financial success and financial freedom. It allows you to financial freedom really live a full, relaxed and harmonious life. So all people have to live!

The quest for financial freedom (goal - to reach the state of financial freedom), determines the need for skillful handling of expenses and income, making the right decisions on major acquisitions (apartments, cars and other expensive facilities), the ability to maintain and increase money.

Without planning and management to cope with such a task is not possible. On the way to financial freedom must be able to analyze your income and expenses, to be able to take informed decisions regarding the purchase / sale of property, savings and the accumulation of money, etc.

Why Is It Important To Manage Your Personal Finances

 

What you need to manage your personal finances? Difficult it?

Difficult it? Not if you understand the basic principles. Do I need to do any special tools? You can do a simple calculation to Excel, almost without using any complicated functions of the program.

In the planning of personal finances (or family finances) you define the main objectives for savings, income and expenses (for the long term - a year or several years, and for the week / month), acquisitions and additional sources of revenue.

The main parameters, is very simple to perform and adhere to the slightest discipline in handling money. It is also much easier to make competent decisions regarding the purchase / sale of property, attracting / closing credits.

I personally have over 15 years of practice, planning and personal finance. Having tried various techniques and programs has gone trial and error. Now I've done simply and clearly. Planning takes a little time, and cost accounting - even less.

Financial freedom is worth the small effort of learning how to do the planning personal finances and accounting of expenditures and revenues. A financial freedom is worth more than financial success.

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The Main Errors Of Those Who Aspire To Financial Success

Many of us strive for financial success. Many would like to earn good money, but not much to this stremsyatsya because they do not know what to do, or just lazy, thinking how it all hard.

In fact, the main obstacle on the path to financial well-being - the lack of knowledge (rather simple, almost at the level of common sense), as well as the influence of misconceptions and attitudes.

 

Misconceptions On The Path To Financial Success And Well-being:

• Financial success and well-being involves a high income and are only possible with high earnings.

Have a great income is good, but not enough to be financially prosperous. More importantly, how to relate to your income and expenses, as well as what their structure and reliability. In simple words, the financial well-being / freedom - is a situation where your income exceeds the income, plus income sources are organized so that you do not necessarily work. Revenue comes not only and not so much on the work, and mainly from other sources. It is therefore more important to efficiently organize their income and expenses to get a positive result.

• Financial success and well-being need to buy a lot of things and have a

Often the purchase of a luxury apartment and the car turns into financial slavery, especially if the purchase is made on credit or in debt. Promotional offers banks sounded tempting. We were on all sides beckoning not postpone life for the future, to live now, talk about how comfortable and good use of loans. But loans are tied to the exchange rate and the rise in price dramatically. Plus, it makes a huge amount of interest a year. With skillful planning, you can do without loans and make banks work for you, not you to the banks. If you change the strategy, the difference is huge. You do not lose on interest and add interest to their salary. You, however, there is another salary.

Even without the loans, expensive cars and apartments require fixed costs (repairs, insurance, etc.). When understanding the principles of personal finance management can do differently with these acquisitions, avoiding the financial burden, and vice versa, adding additional sources of income, bringing the time of financial freedom for themselves and their families. How to do it, I will write in my future posts.

• The rich must be born

Most of us grew up in regular families. Wealth inherited get a little. But all is not so bad. The main thing - to understand how to do it, to understand the main points in the management of personal finances and stick to a simple strategy / plan. within a few hours, days, you can make a clear step by step plan. Within a few months to significantly improve the situation, in six months, a few years to achieve full financial freedom. It is important to know and understand what to do. No more ...

The Main Errors Of Those Who Aspire To Financial Success

• First of all you need to buy a car and apartment renovated, in whatever that was!

This favorite setup of our parents and grandparents. For them it is the main indicator of well-being of an individual or family. And this is the most harmful misconception is the greatest prevents us from understanding the simple principles and make the right decisions, condemning to a vicious circle of financial slavery - apartment and a car loan and the payment of a lifelong work credits (now the apartment and a car, then at large - when the family and will expand). It is an endless story leading to the complex and hopeless life and eternal relation to work or business. Why do we need it?

Discarding this setting, we can all do it differently - first create sources of revenue, and then use them to buy everything and maintain. It is not difficult if you know what to do.

• It is better to take a loan or installments to buy a new apartment and a car. It's easier. Otherwise, never buy.

If we accept that in the first stage can refuse to buy an apartment and / or machines, and more importantly to create sources of income, the decisions are quite different, but the results are stunning. You can organize your life so that banks will work for you, your money will work for you. And they will buy, and will contain an apartment, a car, a family, pay for your vacation, clothing and entertainment ....

• Loans (percent) -of your opportunities.

• We need to work or to make a career, or to create their own business. In another way to become rich is not possible.

Initially, you need to earn money. Yes, and it may be interesting and fun. The main thing to dispose earned money. Then, for several years after the start of working life, you can build a competent set of sources of income. In sum, with the earnings from employment or business, they will allow you to more quickly come to their goals - financial freedom.

 

What conclusion and where to start?:

I suggest that around quietly understand and to act correctly - to earn money and skill to dispose of them. I am willing to help you - to teach, to tell, to conduct a step-by-step on the path to financial freedom and financial well-being.

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How To Easily Start Keeping Track Of Your Finances?

How often do we say to ourselves, "I do not have time to keep track of your money," or "Oh, I forgot again (a) to make expenditures for the 4 days! We'll have to start all over again." Can I start a record of their "hard-earned" without instantaneous adjustment of your lifestyle? Five simple steps will help you with this.

When a customer writes a pervading theme of "help start saving," you always want to help. However, in family finances, unlike let's say from the health, can be made independent preliminary step "self-healing".

So.

1. Do not vanity "Haste is needed only when catching fleas and ...." (Shchukar). Do not rush to read a bunch of books written for free, much less paid seminars.
Look, calculate your costs for a week in any convenient form.

2. Read the deficit! Calculate the cost per month and compare with their income. Calculate the difference.
If negative - that you have a deficit. This is normal.

If revenues exceed expenses - you - is brilliant and you can move on.

3. Save easy! Do not try to just cut back on 20% of their costs. It is better to do it smoothly.
Start with what you could have done a year ago. Restaurants, light snack on the way home, the amount that you could not remember where to spend - here is your resource.
These savings can lead to equality of income and expenses in your budget.

How To Easily Start Keeping Track Of Your Finances?

4. Plan your budget for the week! Try to make the budget next week, and already at this stage to calculate each item of its expenditures. Holding up actual money spent during the week and by comparing actual expenses with planned amount, you will realize how much you are to perceive their financial situation.

5. month living with a new budget! Just do it. Look at your record, you will be doing during this period.
Pay special attention to your feelings and emotions, where every day you will make to your spending log book.

If you work at your budget is not observed sharply negative emotions - you can safely go ahead and look for training, books, advice of consultants who will lead you on to your financial security!

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Personal Financial Plan Best Advisor Tips

The desired objectives and results can come in two ways: by acting on a hunch, intuition or acting systematically and according to plan. The first option may seem simple, but in fact "the road to dodge" and where in the end you will come, it is practically impossible to predict. The second method takes more effort at the start, but it pays off "in a way."

Therefore, if you decide to approach the issue of managing their money consciously, you need a tool with which you will be able to see what's happening in your personal financial world today, and what actions need to be taken to achieve the desired tomorrow. This tool is called a personal financial plan.

Making personal financial plan requires a special approach and attention, because of how well and thoroughly you think about your strategy to the goal will depend largely on the outcome.

The first thing you have to do - to objectively assess the current financial situation and start to track it over time.

The ideal option if you already have a personal budget scheme, i.e, your income and expenses for the previous months you thought. But even if such information is "on paper" is not, do not worry. Individual financial plan is a long-term view and, therefore, time to learn to adjust your budget and you will have plenty.

In addition to the revenue and expenditure in assessing the current financial situation should take into account your existing assets (anything that can be sold) and liabilities (debt securities of any kind). Assets will objectively assess your resources and liabilities show where and how much you "sink."

Personal Financial Plan Best Advisor Tips

Compiling a personal financial plan, be sure to make it a strategy to get rid of liabilities!
After we have seen what is happening in our personal financial world really thought through how to reflect the situation, you can optimize the budget and outlined the strategy for getting rid of liabilities - is the time to look to the future. Put financial goals.

It is clear that each of us are not financial targets 1, not 2 and not even 10, but in life there are a number of events that can be predicted and predictable. Wedding, birth of a child, buying cars and real estate, education of children, the pension - it is expected things. Therefore, the further preparation of the financial plan goes as follows:

Based on current prices, we can assume how much money will be needed to implement the plan. Furthermore, we can predict the time at which it is desirable to us to attain the goal.

But! Here it is necessary to take into account two very important factors. First, the calculation of the cost is required to take into account the average percentage change in inflation. And secondly, the calculation of deadlines, it is important to remember their financial capabilities.

This approach will give an understanding of what it is better to use the tools of investment to achieve each of your financial goals. A regular investment, matched with the personal financial plan - one of the basic principles of successful financial management.

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The Best Time To Invest It Is A Crisis Finance Tips

In times of crisis, there are only two models of behavior. First - hide and wait out. The second - to fight and win. Many believe that the crisis is not worth trying to invest their money for fear of losing them. Such people last fall raised money and kept them at home. And what happened?

We perfectly know the answer to this question. Their accumulation halved in December, when the ruble collapsed. One of the main ways to protect yourself - is to invest, trusting their investment companies. 

According to Tatyana Gryaznov, Director General of company "AMI" rich, "" In times of crisis, incomes are rising investment professionals. After all, what is a crisis, really? This is a period of instability and sudden changes in quotations on exchanges, exchange rates and so on. D. And it is on these changes and make traders and investors with them. "

Moreover, in such periods investment companies try to attract the maximum number of customers and offer them the most favorable conditions, the most effective rates and lowest amount to enter the investment portfolios.

Everyone takes for itself the decision whether or not to hide from the crisis, or earn it. And every man is responsible for the consequences of his decision. So, how shall it those who piled rubles in cans of coffee last fall.

And for the rest of the hotline is always open to international investment agencies "Rich!", Where each will receive answers to all questions: 8800700 43 73 or you can contact me on line for advice.

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Top 10 Financial Mistakes That People Make

Error 1: No "safety cushion":

The vast majority of people believe that any accumulation of completely useless: all lose anyway, so why save when you can spend it all now and buy some necessary thing? Perhaps a specific moment of life decision may seem true, but after some time, you may need a certain amount of contingency: minor repairs in the apartment or pay medical or increase the rent or salary delays ... Referring pay these expenses if no savings at all? Credit may not give, and to receive it often takes several days or even weeks, and you may not be this time.

That is why it is important to remember about the first rule: you should always have a savings of $ 3-6 monthly cost of an emergency.

Error 2: Reserve "under the mattress" rather than bank:

In Russia, at least 50% of the population use bank deposits to 5% - are investors in the stock market. And for the reason that few people trust some financial instruments, preferring to keep the accumulation of houses under the pillow / mattress / in the bedside table, and others. In fact, this kind of "investment" provides a guaranteed income minus 10-13% per annum! The reason is simple - inflation. So, your current 500 thousand. Rub., Placed in the nightstand, turn 5 years already 310 thousand. Rub. with an inflation rate of 10% per year.

So the second rule: do not keep accumulating in the bedside table - it is better to place them at least for a bank deposit to save from inflation. Are you afraid of a bank failure? Teach that when placed in a bank up to 700 thousand. Rub. If you revoke his license, you are guaranteed to return the contribution to the safe and sound thanks to the deposit insurance system.

Error 3: Improper loan options:

When choosing a loan, it is important to remember that it should:

• Be in the currency in which you get your salary. Most often it is Dollars. If tempted to take out a loan in foreign currency at a lower rate, then you can get the growth of your monthly mortgage payments by 30-50% due to the devaluation of the ruble;
• Not be too large: take a loan is not "with reserve" just in case, namely the amount that you need. Note that taking extra 50 thousand. Rub. on credit, you must return the bank is already 75 thousand. and more;
• Not be too long: take credit for the time that the loan payment was feasible for you, but not too low. Please note that the loan of 200 thousand. Rub., Extended for 5 years instead of 2, will lead to the need to pay the extra 110 thousand. Rub. jar.

So better to take a loan in rubles, for the most desired amount and for a minimum period, to payment on the loan amounted to 20-30% of your income.

Error 4: The chase for yield:

The risk-free yield is higher than the interest on deposits does not exist. Therefore, the income above 12-17% in rubles and 5.9% in foreign currency are guaranteed associated with risk of loss of some or all of your savings. So when I saw an advertisement for a guaranteed yield higher interest on deposits, it is better to bypass this company party, t. To. With very high probability it will be a pyramid scheme.

Top 10 Financial Mistakes That People Make

Error 5: Investment without a time limit:

It is not possible to invest properly if you do not know for a particular purpose is made. The "earn" - is not the goal. The aim should be time, cost and priority. Only by clearly defining it can intelligently find the right tools for you to invest. So, if you invest with a view to save up some important goal in 1-3 years, it is better to prefer bank deposits and highly reliable bonds or bond funds.

If it is a goal of 3-10 years, in addition to deposits and bonds, you can add to your portfolio of up to 50% of the shares or equity funds. Well, if you invest for 10 years or more, it is possible to increase the stake to 70-80%.

Error 6: Underestimating their response to risk:

If your co-worker or neighbor will invest in equities and rejoices yield of 20% and higher, it does not mean that you have to buy them immediately. The fact is that each person - their level of risk appetite. And if your neighbor is willing to tolerate at times fall in the value of its shares to 50%, then you may be not ready for this, you sell stocks just at the wrong time, get losses and investments will be disappointed.

It is therefore very important to correctly identify their risk tolerance: if you are not ready for a significant drop in the value of your investment, place most of the funds in deposits and reliable bond. If you are ready to swings size of your savings - can be a significant portion of their place in the action.

Error 7: Neglecting insurance:

The Russian insurance Apartments, machines and the more life is unpopular, t. To. The majority believes that they just do not happen. Life is insured by less than 2% of the population, although one of the most common causes of delinquency and defaults on loans are just incidental expenses for treatment. Such costs to repair flats for compensation flooded neighbors below, to restore their health in most cases are unexpected and require substantial expenditure to which not everyone is ready. Therefore, property insurance, liability and life is the key to confidence in the future of each person.

Error 8: Start saving for retirement for a couple of years before it:

The pension as a financial goal is rarely one meets a large part of the population about it not even think putting "for later". Meanwhile, if you want to retire at 40 thousand. Rub., Then you need to set aside each month for at least a bank deposit of not less than 25 thousand. Rub. for 10 years! If you remember about the pension for 3 years before leaving her, then retired 40 thousand. Rub. you will have 3 years to postpone to the deposit already 130 thousand. rub. per month. So you need to think about retirement at least 10 years before.

Error 9: Ignoring tax benefits:

Not so many people know and enjoy all kinds of tax deductions. In the meantime, anyone can get into the account each year to 15 600 rubles., If he pays for training, treatment, invested in their retirement or was engaged in charity work. If you buy an apartment or a house, you can get the account up to 260 thousand. Rub. plus additional compensation for interest on the loan for the purchase of real estate. Thus, at the mortgage in the amount of 5 mln. Rubles. 15 years at 12% the use of tax deductions on interest would return 13% of the amount of interest paid on the loan - more than 750 thousand. rub.

Error 10: No personal financial plan:

Personal financial plan - it's basically a rarity. But his absence may lead to serious consequences. For example, if a person thinks only of buying a car in a year, but the purchase of an apartment at 3 years and payment of education of his son after 10 years, he has no plans, it may well be that he has accumulated the required amount on the car, but the increased transport costs It does not allow him to accumulate the amount of a down payment on the mortgage. As a result, he will buy an apartment without down payment, with a smaller area than we would like, because the more he did not have enough opportunities.

Because of the large credit payment will not be able to save a total of training his son, and he will not act in the best university to get to the free office. If by that time education will be fully paid, son just did not have anything to receive it. On retirement the person in question and can not speak. And all this adverse scenario has occurred only because the person in front of him had only one goal, not a full-fledged financial plan that takes into account the target until retirement.

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