Financial independence is not easy to achieve and no one can achieve it overnight but with the right mindset and ample of time to act out your investment play, it can be made quite achievable. It generally means having enough amount of money to care for all the needs of a person and a good investment portfolio, curated over the years will definitely be able to do that for you.
Financial independence is a concept which can be brought to reality by a very few number of people. Generally a person’s needs comprises of 3 need categories that help them classify their needs based on priority, and they go as follows:
1. Basic needs
2. Comfort needs
3. Luxury needs
One has to think and evaluate the amount he requires to save and be able to achieve the financial independence. A person needs to save at least 2 to 3 years of his expenditure amount in advance, so that he does enjoy a certain level of financial independence. It is also seen that people who have this level of savings earlier in life can actually work stress free and can negotiate better as they do not have risk of losing out compared to others who do not have this kind of savings.
People who know How To Invest Money Online can channelize their fund in a more effective way. This helps them to make more money by maintaining a more diversified investment portfolio.
Financial independence is not easy to achieve but it is certainly nothing impossible if the whole process can be broken down to small stages any person can actually attain financial independence. Another positive note on breaking down financial independence into stages is that it keeps the person motivated as he reaches each stage and moves on to the other.
The most common problem with people these days that as soon as they start earning, they start taking up loans or EMI’s which compromises their future savings and they face difficulty in the hour of need. So the primary thing that needs to be taken care when talking about financial independence is that people need to save as early as possible in life, the main problem here that people doesn’t even start saving years after they start earning. Saving in today’s era is more simple than ever before with the introduction of internet, there are many applications which are available within the palm of our hands, these applications can be used easily all a person needs to know is how to invest online, this can prove to be very beneficial to a person as he can make more money which will help him to take care of his needs.
Maintaining a diversified investment portfolio can help a person to achieve financial independence as he gets returns from multiple securities in a more relaxed and stress free way. In case any of the securities value goes south it will be backed by other ones which are receiving higher interest rates. This is the interesting point when a person have diversified investment portfolio he can have a stress free life and yet he can attain the benefits of financial independence.
One of the most important things a person needs to take care of in order to achieve their financial independence is to have a passive income, this is a major reason that differentiates poor from the rich people, the rich have ideas to generate passive income which helps them to make more money whereas the poor are unable and mostly rely from their income from jobs which is hardly sufficient enough. On the other hand people in their 20’s and 30’s should learn how to invest online and maintain a Diversified Investment Portfolio in order to reach a stage of financial independence early in life.
Breaking down financial independence in stages is always an easier way to achieve one’s financial goals because they are easier to target that way. If you also aim for wealth creation and to achieve your financial goals then a diversified portfolio will always get you a step closer to achieving your dream, and maybe even in lesser time than you stipulated.