Budgeting For Independence 

Do you want to be financially independent? For many youth and adults alike, the answer is, yes! But the bigger question is…how does one become financially independent? Read on for some tips and tricks to get you on the way to financial security. 

 First Step: Get a Job to Save Money 

If you’re not financially independent right now, you likely live with a friend or family member. This can buy you some time to gain the life experience and skills you need to get on your own two feet, but you need an exit strategy.  

Rather than wasting precious time, you need to work as much as possible preceding your planned move-out date. If you don’t have a job, you’ve absolutely got to get one before you will qualify for a place of your own and begin covering your necessities. 

Here’s the big reason why you should have a job before moving out of your current, shared residence. If you don’t have enough money saved up to pay for at least three months’ worth of rent, you may find yourself at risk of homelessness. Even with a job, you will likely still need a backup plan to cover the unexpected. 

Let’s say you are faced with an unexpected emergency, such as a broken arm. Now you have unexpected hospital bills to cover, in addition to paying rent on your own. Because you lack a financial portfolio or savings, you may be worried you’ll end up on the streets if you can’t find a lender to work with you. You could go online and search payday loans online direct lenders only to help you cover the unexpected expense.   

Save for Monthly Bills 

Most bills like gas and electric are charged to customers on a month-long billing cycle. Rent is also often collected on a monthly cadence. Because so many bills are paid on a monthly cycle, here is a clever way of holding back money for monthly bills that you may not have considered. 

Known by some as the “half payment budget method,” this strategy has built up quite a reputation online. The concept is easy—with each paycheck, set aside half of the funds to go toward upcoming bills. But the time your bills arrive, you’ll have the money already set aside to cover them, as opposed to having to budget all at once.  

Save First, Invest Later 

You’ve almost certainly heard of friends, family members, commercials, teachers, or other sources talking about investments. While investing is the go-to way for building long-term wealth (just ask Jeff Bezos, Warren Buffet, and Bill Gates), you should have all your debt paid off before you think about investing. Once you’ve saved a sufficient amount and paid off your debts, you can look into diversifying your financial portfolio. 

Key Takeaway 

We all want financial independence, but it takes time, dedication, and some knowledge in order to get it right. Be sure to keep learning about basic personal finance strategies and best practices for reducing expenses in order to more quickly obtain financial independence. 

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