Financial freedom looks differently for different people. For some, it’s all about building up a large retirement fund and being able to retire early. Or perhaps it’s having enough of an emergency fund and investments to sleep better at night. Regardless of what your vision of financial freedom looks like, there are a couple of fundamental steps you’ll need to take to achieve it.

To be financially free means that you will have to do a lot of planning, saving, and budgeting. You’ll need to remain focused and keep your eyes on the goal. Of course having an emergency fund is important too – you never know what’ll happen and don’t want a setback to completely derail you.

Here is a handful of the very best tips out there to those who would like to be financially free a bit sooner. That way, you can focus on building a career of what you love or just growing a big and healthy family.

#1 Safeguard your finances

You probably know very well that insurance is important but how many of us go beyond the health insurance? If you’re able to, it’s a good idea to look for other ways to safeguard yourself in case something should actually happen. Have you thought about taking out a disability insurance, for example, so that you’re able to have a steady income even if you’re not able to work the same way you used to? Or perhaps life insurance to protect your life or a loved one?

Try to think about other ways to keep your personal finances safe regardless of if you’re in an accident or going through a difficult time. Find personal injury lawyers with years’ experience in case something should happen while in the car and make a note of all the other numbers you might need in case the other person should make a claim against you.

It’s the kind of stuff you’d be very happy you thought about if something should happen. Remember that no one likes paying for insurance until they need it!

#2 Build an emergency fund

Having goals are important, having income to support that goals is more important, but arguably the most important part of your personal finances is an emergency fund; 3-6 months of expenses saved away in a separate savings account.

When you manage to have an emergency fund setup, there is nothing life can’t throw at you that you won’t be able to bounce back from. In general, an emergency fund should consist of between 3 to 6 months worth of savings – enough to keep you going for a while, in other words.

How much you’d like to put in is up to you, just make sure that you’re able to cover yourself for a while in case you should be out of a job. Even if your emergency fund keeps running empty due to all of the emergencies in your life, you’re still doing it right – just keep saving.

#3 Focus on setting up passive income

Now that you have your savings plan in order and know that you have the kind of insurance you need in case anything should go down, it’s time to focus on increasing your income. The trick to this is, of course, to have more than just your day-time job.

While a career is something you can build on, achieve your dreams with, and feel like you’re making an actual contribution to society as well, it’s nice to have a source of income that is just for the luxury of having money. To some, this is found in real estate while others prefer to invest in the stock market. For others, it may be a side-hustle.

What you choose is naturally up to you but keep in mind that this passive income will help you to enjoy your career a bit more. You have the money you need, after all, and can focus on making a proper contribution to society instead, making this extra income a nice bonus.

Financial freedom may sound like a dream to many of us, but it usually takes years’ worth of dedication and hard work to achieve. It’s totally doable, though, as long as you’re willing to work hard for the first decade of your working life and simply enjoy the rest.

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