Financial freedom can imply to distinctive things for varied people. While some may consider it to be the freedom to buy anything they want, for many others it may just mean that they do not have to worry about paying off their bills or any kind of sudden expenses. カヴァン・ チョクシ says that for a lot of people financial freedom can simply mean becoming debt-free or accumulating enough money to retire. While all these interpretations are correct, financial freedom largely involves being in control of their one’s own finances and by maintaining a systematic approach people can easily achieve this goal.
カヴァン・ チョクシ shares insight into how to achieve financial freedom
What exactly does financial freedom means to a person would largely depend on their current financial situation and lifestyle. Hence, the very first marker on the path toward financial freedom begins with knowing where a person currently is financially. This includes having a clear idea of how much debt a person has, their monthly income and expenses, as well as accumulated savings. Basically one needs to have a clear idea about their income, expenses, assets, and liabilities prior to moving towards the next step of achieving financial freedom which includes underlining the goals and objectives one has.
There are many reasons due to which one would want to acquire more money, like paying of an education loan, starting a business, planning a wedding or even saving up for retirement. Hence, money can be considered to be just a key means to achieve varying goals in life. To stay on track and make the best possible use of their income, people should write down the goals they want to achieve in the next 1, 5, 10, and 20 years. To reach these goals, one must track their spending in a consistent manner. Tracking of expenses is a vital step towards achieving financial freedom as it makes people more accountable. It also helps in revealing the various unnecessary expenses one makes just on account of an impulse buy. An impulse to buy is largely about losing control and ideally works as an obstacle in the path to financial freedom. Hence, people must try their best to stay in control by properly tracking their spending.
Apart from managing expenses, paying off debt is also a crucial aspect of achieving financial freedom according to wealth consultants like カヴァン・ チョクシ. After all, paying off debts not only lifts a huge weight off the shoulders of a person, but also goes a long way in improving their credit ratings. Broadly speaking, there are two major methods of paying off debt. The very first one is the snowball method where one pays the smallest debt first and then moves on to bigger loans. The second method of paying off debt would be the avalanche approach where one firstly pays off the debt with the highest interest rate and subsequently moves to the lower ones. Both of these methods would work well for anyone having a good amount of debt.