10 Common Questions about Debt

The average US household debt is over $135,000 according to a recent study by Nerdwallet, in the UK it is just under £60,000. Those are huge amounts yet most of us see having debt as a “normal” part of life and might not even think twice about the implications of all these loans.

In this second article in the “10 Common Questions…” series we’ll have a closer look at debt, the advantage of becoming debt-free, different ways to pay off your debt and how to stay out of debt long term.

1: Why is paying off debt so important? 

Becoming debt free has many different advantages. One of the main ones being that it will save you a LOT of money. Debts are hugely expensive, much more so than most people realize. By becoming debt-free you are no longer wasting money on a loan for something you might have purchased months or indeed years ago. 

Another key reason to become debt free is to no longer be indebted to anybody else and take complete control over your money. Whether you have a loan from your bank, a store or the government, when you’re debt free, nobody but you can make a claim on your money.

If you do ever need to take out a loan, such as for a big purchase like a house, you’re also much more likely to get a loan and with better conditions. The more responsible you show you can be with money (i.e. not have lots of outstanding debts), the more likely you will be able to pay back your mortgage, the less of a risk you are to a bank, meaning they are more likely to grant you the mortgage and at a lower interest rate. 

2: But doesn’t everybody have debt? Is’t that just part of life?

Having debt has certainly become the default for most people and indeed for society as a whole. We see having debt as a standard thing in life, but that of course doesn’t mean that it’s actually the BEST option to pursue. Having debt costs money, ties you to your creditors and might keep you in a job you don’t enjoy simply because you need to pay all those creditors. 

Added to that, if you are looking to progress and get ahead or indeed pursue Financial Independence, you don’t want to do “what everybody else is doing”. If you want to achieve different results, you need to do different things to what other people do. How many people do you know who have debt? And how many of those are Financially Independent? I think that says enough. 

3: But my interest rate is only 1.5%. Surely that’s not so bad? 

A trick that many credit providers use is to state their interest in monthly percentages, when really you should be looking at the yearly percentage. A 1.5% interest rate means the annual interest rate is 18%. That sounds a lot more serious, doesn’t it? 

Let’s look at a quick example of what 18% means in terms of the total costs for you. 

If you had a $1,000 credit card loan at a 1.5% monthly rate and an agreed payment plan of 3% per month (meaning each month you pay back 3% of the outstanding balance you owe) and a minimum of $10, you would pay back the incredible amount of $1,779 in total on this loan! Not only that, in addition to the nearly $800 in interest you pay, it would also take you 9 years and 10 months to pay off this loan. That’s a huge amount of time for a loan of $1,000 at “just” 1.5%. 

4: But what about that new car / planned holiday / latest gadget I want?

Living with debt and therefore buying something before paying for it, has almost become a standard way of life: something many of us don’t even think about anymore and take for granted. But it doesn’t need to be like this. A much healthier, cheaper and satisfying way to purchase something new is by being able to pay for it up front instead of by financing it.

In order to do this, you’ll need to set up savings goals and plan ahead about when you might need to make a bigger purchase, such as that new phone, your holiday or replace your car. Once you’ve got a goal you can work backwards and decide on a set amount you need to put aside each month in order to be able to have the money saved up at the time you expect you might need the money to make the purchase.

Becoming debt free doesn’t mean you can’t get that new gadget, it just means you save up the money first before you purchase it and just requires a little bit of planning (and patience!). 

5: How long will it take to pay off my debt?

Of course this depends completely on how much debt you have and how much you are able to free up to pay towards this debt each month. There are many excellent online debt calculators available that can quickly show you just how long exactly it will take you to pay off each one of your debts. Let’s have a quick look at an example to show you how fast it might go though. 

Let’s use the same loan from earlier as an example ($1,000 loan, 18% interest rate, 3% monthly payback with a minimum of $10). If you were able to pay an extra $25 each month in addition to what you get charged by default by your credit card company, you would “only” pay $221 in interest, over $550 less than the original $779! Added to that, with the extra $25 a month you pay, it would take you just 31 months to pay off the loan (a little over 2.5 years) instead of the 118 months mentioned earlier!

As each loan and situation is so different, I recommend you use an online calculator to play around with some different numbers of how much you might be able to pay off extra each month and see what the effects of this are on the total costs of your loans. If you have more than one debt it’s important to choose the right strategy for you when it comes to paying off your loans: using either the snowball or the avalanche technique.

6: What’s this “snowball” technique?

The snowball debt repayment technique recognizes that paying off debt isn’t just a numbers game where all you do is consistently paying some money towards your debt. There is a substantial psychological component involved in this process too, more specifically: motivation.

Your motivation to get started on paying off your debt, your motivation to keep going even when the journey becomes dull or hard and the motivation to stick with the adjustments you need to make to your spending habits. 

The snowball technique encourages you to start with the smallest debt that you have, and begin to pay down this debt as fast as you can. In the mean time you keep making the minimum contributions to any other debts you have, you don’t want to accumulate more interest or penalties than needed after all.

By beginning with the smallest debt you will pay this off relatively fast, giving you a quick motivation boost as you witness the results. Then you move on to the next smallest debt for which you now pay off the minimum amount you were already paying + the money freed up from the first debt. Each time you pay off a debt, you free up more money to start paying off your next debt.

7: What about the “avalanche” technique?

The avalanche technique is similar to the snowball debt payment technique with one difference: instead of starting with your smallest debt, you begin paying off the debt with the highest interest rate. This is after all the one that, when left over time, accrues the highest amount of interest on it, meaning that by paying this one off first you save yourself a lot of money over time.

Like in the snowball technique, make sure to continue to make the minimum contributions to any other debts you have whilst you pay off your highest interest one, to avoid extra charges.

8: How can I stay out of debt?

There are three key things you can do to avoid going into debt again. The first one is to ask yourself whether you really need what you’re buying right now at this price. Is there a cheaper option available that would do? Can your old phone last another 6 months? Can you wait for a newer version to come out and buy the discounted older version? 

The second habit to develop is to set up savings goals and plans: if you know you’ll need a new phone in the next few months, then start saving up for this today by consistently setting aside money until you have the money available. 

Thirdly, accept that sometimes life throws a curve ball at us that can lead to instant costs you just have to pay in the moment: a broken washing machine, a car maintenance or a vet bill that you just need to get done in the moment. For these emergency situations, make sure you have an emergency fund available: start building up $1,000 set aside that you only use for these emergencies. 

9: Paying off debt… then what?

Once you get rid of all debt, and have put in place measures to avoid going into debt again in the future, that’s a huge achievement in itself and most definitely is something to be proud of. But it is only one of the pillars on your road to Financial Independence. There are other steps you can take, in the area of your income, investing, retirement that you can now focus on towards a secure financial future.

Commit to moving on to the next area of your finances and continue your journey towards Financial Independence. (One way to do this is of course to make sure you follow this series of articles!).

10: Where do I start?

The road to becoming debt-free isn’t easy but certainly worth it, so if you are committed to paying off all your loans, here’s what you can do:

  1. Find out all you can about your current debts: outstanding amounts, yearly interest rates and monthly payback amounts.
  2. Start by paying off extra money towards 1 debt using the debt snowball or avalanche technique. Free up extra money from a yard sale, a side hustle or by picking up extra hours at work. 
  3. Make sure to stick to your minimum payments on all other loans, don’t default on those monthly payments.
  4. Once you’ve paid off one debt, use all the money you’ve freed up from no longer needing to pay off that debt to start on your next loan. Keep at it until you’ve paid off your last debt.
  5. Start building up an emergency fund to avoid having to go in debt in the future.

This article is part of the “10 Common Question series”, where I address issues about some key financial areas, including Financial Independence, paying off debt, increasing your income, retirement provisions, saving, investing, financial protection and much more. If you want to find out more about Financial Independence, you can sign up to my newsletter to stay up to date or get a free sample of my book 100 Steps to Financial Independence. 

Photo by Republica from Pixabay

10 Common Questions about Financial Independence

10 Common Questions about Financial Independence

Personal finance is hot. One need only have a look at the number of books, podcasts and websites dedicated to this topic to see that we have a keen interest in learning or perfecting our money skills. And that’s not so surprising: who wouldn’t want to have some extra cash, a more secure financial future and a more satisfying financial life?

Luckily, personal finance doesn’t have to be complicated. Whether you want to achieve financial independence or simply learn how to better manage your money, in this new series of “10 common questions…” you will learn all the essentials about personal finance and money issues.

In this first article, we’ll start off with the concept of Financial Independence (FI)- what it is, why you might want to pursue it and how you can achieve FI.

1. What is FI?

FI stands for Financial Independence, which can mean one of the following three things, depending on who you’re speaking to:

  • In the past, Financial Independence was often used to describe women who were financially independent of their husbands: they made their own money and didn’t need to rely on getting an allowance from their husbands.
  • Financial Independence can also refer to the process of growing up and becoming an adult and no longer needing to rely on your parents for money and / or financial help or advice.
  • Lastly, Financial Independence can mean you generate enough passive income that you gain independence from your job and essentially no longer need to work for money.

In this article I will mainly focus on that last meaning of Financial Independence: removing the need to work in your life and being able to pay for your expenses through passive income streams.

2. What is passive income?

There are 3 different types of income: active income, passive income and semi-passive income.

An active income is money you generate by selling your time for money: most of us with a job get paid for showing up to work every day and working on specific during during the time we spend at work.

Then there is passive income: money you get by doing nearly nothing. Think about the interest you receive on your savings account.

A semi passive income is income that you don’t need to work for every day, but does now and again require some work: a landlord receiving rent from its tenants or a musician who sells records 24/7 in any country without physically being there.

3. Why would I want to achieve FI?

One of the main reasons you might want to pursue FI is to free up time and be able to fill your life with more of the things you love doing: be that spending time with your (grand)children, hiking with your pets, pursuing a new hobby, traveling, keep working, working part time only, volunteer, doing absolutely nothing, starting your own business, writing a book, doing up the house or becoming a philanthropist to name just a few ideas. There are many options, just think about some of the things you love spending time on!

The problem with time is that you can only spend it once, after that it will be gone for ever. You can’t rewind a moment and live it again or do something different with it.

Time is our most valuable asset and by achieving FI and no longer needing to work to pay your bills, you can be much more intentional with your time.

4. But I like my job! I don’t want to stop working!

Great if you enjoy the job, the projects you do, the results you achieve, the contact with other people or the daily structure that it provides you.

Luckily for you, becoming financially independent doesn’t mean you have to give up these things. Once you reach FI you need longer NEED to work for money, that doesn’t mean you’re not ALLOWED to! If your job gives you happiness, satisfaction and a sense of purpose or belonging, then by all means don’t walk away from it! In fact, many people pursuing FI like work and aren’t necessarily thinking about quitting their jobs.

What it does mean that if for whatever reason they no longer want to work (due to a change in family situation, a company structure change or for any other reason), they can just decide to stop whenever they want!

5. How can I reach FI?

If you’re keen to start working towards Financial Independence, your main objective should be to build passive income streams to replace your income.

Some common ways to do this include investing in the stock market, crowdfunding or investment property.

You can also create a semi-passive income stream that, although not fully passive, still only needs a much smaller amount of time to set up or manage. This can include blogging, online courses, selling craft on Etsy or really anything else that you are good at and enjoy doing and you believe people might pay for.

6. How do I know I’ve reached FI? 

You reach Financial Independence when your passive income can pay for your expenses.

There can however be some variation in this: do you want all your expenses covered (including those that are “savings expenses” to build up savings or investments?, do you want just the essentials covered or do you want to be able to spend even more than you currently are?

The road to FI has 8 different stages, so depending on which one you are pursuing, you are the only one who can decide whether you’ve reached FI!

7. What are these 8 stages of Financial Independence? 

Becoming familiar with the 8 stages of Financial Independence can help you determine where you are on your journey to FI and what your goal is, i.e. where you want to get to. They are:

  • 1 – Financial dependence – when you rely on others to provide for you. This is how we all start off in life!
  • 2 – Financial solvency – when you can pay your own bills and financial commitments, but likely have debt.
  • 3 – Financial stability – when you have some savings / emergency money set aside in case of adverse financial situations.
  • 4 – Debt freedom – when you no longer have any debt.
  • 5 – Financial security – when you have passive income that can pay your essential expenses, such as utilities, food, insurance, transport and housing costs.
  • 6 – Financial independence – when your passive income can pay for all of your expenses, including the discretionary (fun) ones.
  • 7 – Financial freedom – when your passive income allows you to splurge on some luxuries now and again: a fancy holiday, a second house or a more lavish lifestyle.
  • 8 –  Financial abundance – when money isn’t a problem anymore you really have no limits in terms of what you can pay and do.

8. How long does it take to reach FI? 

One of the main factors determining how long it takes to become Financially Independent is your Savings Rate, i.e. how much you save in proportion to your income.

You can calculate your savings rate by dividing the amount of money you save each month by your net income. Say you set aside $300 each dollar a month (putting this into savings, investments, crowdfunding projects etc.) and that your total net monthly pay is $1,500 then your savings rate is $300 / $1,500 * 100% = 20%.

The higher your savings rate, the faster you’ll reach FI. There is as excellent post by Mr. Money Mustache where you can find out how different savings rates affect your time til FI. In the case of 20% this would be 37 years. If you manage to save 30% then you can retire after just 28 years.

9. Do I have to earn a huge salary to reach FI?

As we saw in the previous question, your main most important factor to reach FI is your savings rate. Regardless of how much you earn you can reach FI. If you don’t make a lot of money, you likely spend a lot less too compared to somebody who earns a lot more.

The more we earn, the more we also spend, meaning we also need more money coming in from passive income to cover all those expenses! As long as you don’t plan on spending more than you currently are, there is no need for you to have a 6 figure salary!

But of course, if you are looking to get rich instead of reaching Financial Independence (or better said: if you are looking to reach stages 7 or 8 of the 8 stages to FI), then earning a lot of money will definitely be necessary.

And having a bigger income CAN also speed up your path to Financial Independence, but doesn’t necessarily have to: there are many big earners who don’t have any savings, simply because they are used to spending everything that comes in.

10. Where do I start?

If you are ready to start working towards Financial Independence, here are a few things you can do to get started:

  1. Start living off less: make small tweaks in your current expense patterns to save money.
  2. Save or invest your money wisely, and automate this process.
  3. Find ways to make more money (pick up extra hours at work, begin a side hustle).
  4. Treat your finances wisely: pay off debt, invest in your social security provision and learn about other ways to become financially literate.
  5. Keep on reading these next few blog posts, where I’ll be discussing more practical tips on many ways to work towards FI, including how to get your money to work for you and create those passive income streams!

This article is part of the “10 Common Question series”, where I address issues about some key financial areas, including Financial Independence, paying off debt, increasing your income, retirement provisions, saving, investing, financial protection and much more. If you want to find out more about Financial Independence, you can sign up to my newsletter to stay up to date or get a free sample of my book 100 Steps to Financial Independence. 

Image by Larisa Koshkina from Pixabay

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Part 2: Define Your Starting Point

Get your FREE sample of the 100 Steps to Financial Independence Book here

After setting your goals to Financial Independence, the next part of your journey is to determine your current starting point. With those two things together, i.e. where you want to get to and where you currently are, it’ll be a lot easier to plan out how to achieve your goals.

Part 2: Define your Starting Point

One common obstacle to achieving financial independence is consumer debt. Most people have some type of debt they have to deal with and pay off, such as student loans, credit card debt, car loan and / or a mortgage. The first step in determining your starting point is to list all of your debts with their current outstanding amounts (i.e. what you still owe) and then total those amounts to get an overall amount.

While debts represent the negative side of a financial picture, most people also have a positive side: their assets or possessions that are worth something. This can include anything from a house to a savings or investment account as well as antique or art of a certain value. Do the same as what you did with your debts: list anything you own along with its estimated value and total those amounts.

With these two numbers you can now calculate your net worth: a very useful indicator of how healthy your personal financial situation is. Simply take the total value of all your assets, then subtract the total amount of debts you have to find your current net worth. Note that this might be a negative number!

Lastly as part of determining your starting point, it’s a good idea to get a solid overview of your current expense patterns. Not only does this help to see where your money is going, it will also come in useful when you start setting goals later on in your journey for the various financial areas we’ll be looking at. Start logging your expenses on a daily basis to get a good idea of what you spend your money on.

Find some time today to look at the tasks above to complete to keep progressing on your path to Financial Independence!

The above is an adaptation of part 2 of the 10 parts in the guidebook to Financial Independence100 Steps to Financial Independence: The Definitive Roadmap to Achieving Your Financial Dreams where you can find more details as well as action plans and guidelines to each of the 10 parts. Available in both ebook and paperback format!

Coming up next: Part 3 of the Journey to Financial Independence!

Part 1: Set Your Financial Independence Goals

Get your FREE sample of the 100 Steps to Financial Independence Book here

When you start your journey to financial independence there’s a lot to consider and go through. There might be many new things you’ll end up learning about or just points you had never really thought about before.

To avoid you feeling overwhelmed and to provide some structure to your path to FI, I’ve divided the many topics into 10 smaller parts, to help you get started on your journey to Financial Independence.

Part 1: Set your Financial Independence Goals

Before you set out on any new adventure, it’s often helpful to take a step back and think about why you are embarking on that new mission. What are you trying to achieve?  What aspects of your current situation are you not as content with and would you like to change? How would your life change for the better? Once you know why you are starting  this new journey, it’ll work as a motivator to get back on track anytime you find yourself veering away from it.

Once you know your reason, it is equally important to define what your new situation would look like when you get there. What is your end goal? What are some of the milestones that you would need to achieve before reaching that final destination?

It often helps to state your objectives as clearly as possible and to visualise exactly what that would look like. Instead of thinking you would like to have more money, define why you want that money, how much you want, what you would do with it and picture what your life would look like.

Here is an example of what that might be:

“I want to have more money so I can spend more time with my family being outdoors. In particular, would need X amount of money to buy a small condo in the mountains. During holidays and for long weekends we can just drive up to our second house and enjoy our time together out in nature.”

Lastly, an important aspect of part 1 of your journey is keeping track of your progress to financial independence and motivating yourself to stick to your targets. You can do this by creating a vision board with your goals, by creating a tracker of your progress as well as by celebrating each time you reach one of your smaller milestones along the way.

Find some time today to look at the questions and guidelines above and then note down some of your answers to them to get you started on your path to Financial Independence!

The above is an adaptation of part 1 of the 10 parts in the guidebook to Financial Independence100 Steps to Financial Independence: The Definitive Roadmap to Achieving Your Financial Dreams where you can find more details as well as action plans and guidelines to each of the 10 parts. Available in both ebook and paperback format!

Coming up next: Part 2 of the Journey to Financial Independence: Define your Starting Points

Book Release: 100 Steps to Financial Independence

1541328964After almost three years of having been “in the making”, the 100 Steps to Financial Independence Book is now almost here! This action-oriented, easy-to-follow and motivational book will be your number 1 go-to-guide to start pursuing Financial Independence now and live the life you truly want!

Sign up to get your free copy now and be one of the first ones to receive it straight to your inbox or mobile reader device as soon as it’s released. (Expected release date: October 2018).

Level 3: Tracking My Expenses

Level 3: Track Your Expenses

The What, When, Who, How and Why of tracking your expensesThis post describes how I started tracking my expenses and what tricks I used. If you’d like to read more about the task itself, have a look at Step 3: Track your Expenses where I describe the procedure in more detail.

Some of the links below are affiliate links, meaning that – at no additional cost to you – I will earn a commission if you click through and make a purchase.

After making some initial progress towards Financial Independence and after having remained on level 2 of the process for a while trying to identify my goals of this mission, I am ready to move on to the next level of this journey: starting the third step and registering all of my expenses.

I know that having a list of all my expenses will be an invaluable resource during many stages of this mission, as many of the steps will rely on a detailed insight of what comes in and what goes out every month, so I am totally committed to start keeping track of everything that happens with my money.

The infographic on the right tells you more about which factors to consider when registering your expenses.

What

I’ll be registering all my cash, credit card, debit card, transfers, standing orders and other payments from my checkings and savings accounts as well as any payments from the joints accounts I have with my husband.

When 

I am going to try to register any expenses in the moment as much as possible, but of course I know there will be times I’ll forget and I have certain payments automated, so I’ve decided to take 5 minutes at the end of each day to check I’ve registered everything, by looking through my wallet for receipts and logging into my checkings accounts. My savings account I’ll check just once a week as I know that currently only has 2 movements a month: when I get my interest and when my automatic transfer gets in. In this way I know I am least likely to miss out on any. I have a reminder in my bullet journey to make sure I do this every evening.

Who

My husband is sooo not going to register his expenses so I know there’s no point insisting. He has his own individual accounts that he is of course responsible for so I won’t get involved in that or ask him to track his expenses, but for our joint accounts I will keep track of things. Where possible I’ll ask him to pass on receipts but I’ll probably just log into our account daily to check what’s happened and to ask him in the moment if I need to know more about a particular expense.

How

I have tried different options to log my expenses and I have in the end decided to go for YNAB – short for You Need A Budget. I love it as it is a relatively easy to use programme and it also has several more advanced features that you can decide to start looking into more once you get the hang of the programme. YNAB can be used both online on your computer as well as by downloading its app and that for me is a key necessity as I’d like to be able to insert expenses both on to go in the moment as well as when I am sat at my desk.

Of course if you’d rather stick with paper and pen option that is no problem either and the advantage there is of course that you don’t need any type of technology to keep up your new habit.

Other alternatives include using a digital programme such as Microsoft Excel or Mac’s Numbers to track your money as well as other apps widely available – just search for them and see which one you like best.

Why
My own main why is that I want to gain insight into my spending pattern so I can identify where I can save money in order to boost my savings for long-term goals I have, the most obvious one being reaching Financial Independence of course.

These are my own 5 key strategies to tracking my expenses. If you aren’t already tracking your own expenses, make sure to start today and read up about it in the detailed explanation in step 3: Track Your Expenses.

Level 1: My Commitment to Achieving Financial Independence

Step 1_ Commit to your mission to Financial Independence

Once I had decided I wanted to become Financially Independent, so that I could regain more control over my time and future, I was aware I had to make the following step: a commitment to my journey, a first advance towards the next level on my way to my ultimate goal of financial freedom.

In order to move from level 0 – my starting point – to level 1, I had to take full responsibility for my progress and dedication to that journey, to make sure I wouldn’t give up on it halfway through.

Following the 100 steps that I have laid out previously on this website, Step 1 is making a commitment to your mission. With the various ideas suggested in step 1 in mind, I have decided to do the following:

1. A sticky note

I’ve put a sticky note on my bathroom mirror. In this way I can see it several times a day, and especially in the morning, to remind myself of my mission. It currently says: “On a mission to Financial Independence.” but I might change the wording with time. You can find a picture of it here on my Instagram account.

2. An accountability partner

I have in fact found several accountability partners: myself and 5 others have formed an accountability group in which we have set ourselves a big as well as five small targets we’d like to achieve over the course of a year. We meet once a month to give updates and ask each other critical questions to provoke honest answers and make sure we live up to the targets we have set and to help each other remain motivated and on the right track. I’ve also got a weekly check in meeting with my partner to discuss progress on some of our targets, including my goal of achieving financial independence.

3. Use of social media

With the upcoming launch of my 100 Steps Mission to Financial Independence book (around June 2018), I decided I’d probably need some social media presence anyway, so I am currently using my Facebook, Twitter, Instagram and Pinterest accounts to put together interesting articles and images to do with Financial Independence and Money Wisdom. In that way I am not only letting others know about my journey, I also hope to inspire people to aim for more financial freedom.

4. My bullet journal tracker and diary

This is the one I am most excited about, as I really believe in the power of a tracker to keep your progress visual. I also find my bullet journal really helpful and motivating to use, so I have decided to get a new bullet journal that I use specifically to keep a log of my steps towards financial independence. I have started with a tracker for step 1, which is an overview of 100 steps, with each step represented by a square, that I will fill or colour in every time I have successfully implemented or completed a step. You can again find a picture of it here on my Instagram account. If you would like to get a free copy of this tracker, leave your email below and I’ll send you an email with a free download that you can print and instantly use!

5. My cat

I can’t finish the list without also including a special mention to my cat, Monkey, who ever since I started working on putting together my 100 steps, has always been faithfully sitting next to me, in front of me, right on top of my laptop, sprawled along all of my papers or in any other way close to me…. You can see her here “supervising” me writing this current blog post here. Whenever I work on the 100 steps she is there with me, keeping me accountable I guess!

And there you have my 4 (or 5) ways of committing to my goal of becoming Financially Independent. For more ideas or if you’d like to read more about the very first step of the 100 steps mission, check out this description of step 1. Remember also to leave your email below to get a free copy of the 100 steps tracker sent to your email.

I’d love to hear about your commitment or ways of making sure you will stick to your goal, so please let me know in the comments below or by posting a photo on your favourite social media.

Level 0: The start of my mission to FI

The beginning of my journey to create more freedom.

More freedom

Over 2 years ago I decided I wanted to have more freedom. Freedom to choose what I wanted to do with my time. Not having to get up super early day in day out to go to work, spend all my productive time in an office, work extra hours whenever this was needed (and working in education means there are ALWAYS extra hours needed!), to then come home being too tired to do stuff I actually enjoyed.

It’s not that I didn’t like my job, quite the opposite: I got (and still get) great please out of it and am able to shape my role in many ways. But whether I enjoy my job or not is not relevant: I decided I didn’t want to spend my entire working days for the next 35 year of my life in an office.

I wanted to be able to be more in control when it comes to my time. Being able to decide every day how long for, what to work on or whether to take a day off and go for a hike or a swim or a snooze or a picnic in the park or…. there are so many other things to do..!

Once I had determined this, an obvious problem arose:

“HOW TO CREATE MORE FREEDOM?” 

As I started reading more about my desire to create more freedom, I quickly found out that the best way to do so and get more control over your own time is by becoming Financially Independent. When you achieve Financial Independence, you have access to enough money coming in from passive income streams, that you no longer need to rely on your job’s income. Meaning you don’t need your job to pay your bills, which means that you can decide to do any job you want (or not) regardless of how much it pays. (There are in fact 8(!) stages of financial independence, you can read more about that in this article). Simply put, if you achieve financial independence, you no longer need to rely on working a full time job, which means you can free up a lot of extra time and freedom to do as you please!

Once I had the answer to the first question (how to become free) figured out, a second question emerged however:

“WHERE DO I START?”

This is where my search for a comprehensive guide began that would show me how to attain this freedom I dreamt about. As I learned with time, there are thousands of people out there who have the same aspirations to become financially independent and many others who have in fact already achieved this, yet the guide I wanted explaining how to do it all didn’t exist!

I looked everywhere on the web, Amazon, physical bookstores, podcast libraries… Nothing! No A-Z guide, 30 day challenge or 100 steps blueprint on how to become financially independent.

The 100 Steps Mission Book

Not wanting to give up my dream I decided that if that manual I was looking for didn’t exist, then I’d put it together myself. I wasn’t talking about WRITING a book, but about compiling ideas together that would be the substitute for what I was looking for.

Long story short… I DID end up writing a book. And as you might have guessed it became the 100 Steps Mission to Financial Independence. (I’m currently working with my editor to get it ready for publication.)

It’ll be out soon and I am convinced it can help many people looking for the same answers that I was looking for 2 years ago: how to get more freedom? More time to spend with my family? More time to travel? More time to do my hobbies? More time to volunteer or pursue a passion project? More time to…. to do anything you want really, without having to plan it around your busy work schedule and commitments! It will give you all the answers you are looking for and is a step-by-step guide you need in order to create that life you really want.

Until it’s out (around June 2018), I’ll be documenting my own experience implementing these 100 steps on my way to more freedom, so you can see how each little step has helped me get closer to my target of more freedom every day. Feel free to join me on this mission to start creating more time for you and your family too and let me know how you’re doing in the comments below.

Coming soon: 31 Day Challenge to Financial Excellence

31 Day Challenge To Financial Excellence

31 Day Challenge To Financial Excellence
31 Day Challenge To Financial Excellence

Are you looking to give your finances a quick make over? Do you want to learn about the 31 most important financial steps you can take right now to kick your money management skills into high gear? Would you like to become more financially organized but do you have no idea where to start? Could your current financial status do with a health check?

If so then join me for the 31 Day Challenge to Financial Excellence, starting October 1st 2017! During these 31 Days you will be given a challenge or task to complete each day that will bring you one step closing to Financial Excellence and Success.

During these 31 days we will cover a huge range of topics: expenses, debt, savings, pensions, income, investing, financial security and many more!

There is no need to read dull money books or spend hours learning about complicated financial concepts, each day’s challenge has all the information you need to get you started!

Sign up now and you will automatically receive each challenge delivered to your inbox on October 1st! Make sure to also join the Facebook group for daily tips, news, support and accountability!

Step 100: Stick to Your Mission

Step 100 of the 100 Steps Mission to Financial Independence: Stick to your Mission
Step 100: Stick to your Mission

This is it, you’ve come to the end of the 100 steps mission, you’ve set important new goals, maybe already completed a few along the way, you’ve implemented new habits, have learned a wealth of information on finances (excuse the pun) and most importantly you have started your mission to financial independence, getting closer with each step that you take.

But despite getting to the end of these 100 steps, you aren’t there yet. Financial Independence is not achieved by reading about money, it is achieved by taking action daily and sticking to it. Remember the examples of people who give up smoking or start a new diet and how often they fail and give up their resolutions alltogether? You’ve come to the second most important point on your mission. The single most important one was when you embarked on this mission and decided to take action and change your situation. Your next most important moment is now and it is your determination to continue with your mission, stick to your habits, keep learning and persist progressing towards financial independence.

With all that you have learned til now and everything you’ve started, now is the time to make a new commitment to keep financial independence as one of your top priorities for tomorrow, next week, the next month, next year, the next 5 years and indeed the rest of your life. Don’t let all you’ve learned and done go to waste. Don’t allow for your hard work to have all been in vain. Keep tracking your monthly spending, making a new budget, noting down your networth, reviewing your investment strategy and tracking your progress towards your various financial goals whenever you can. Continue reading “Step 100: Stick to Your Mission”