1. Stay debt-free
2. Look for multiple income options
4. Keep your financial goals clear
5. Reduce expenditure
3. Keep money aside for emergencies
6. Look for good investment options
7. Keep yourself financially protected
This is the very first step towards financial freedom. The longer you stay in debt, the more stressed out you’re likely to be and the slower you’d move towards financial freedom. Free yourself of this debt circle and only then you’d be able to keep yourself financially secure and healthy.
If you want to achieve financial independence faster, you’d need to have more than one income stream open. Earning money from just one income source would not be adequate to create sufficient wealth for the future. Moreover, it would take a very long time before you can achieve financial freedom.
Life is uncertain. This is what the COVID era taught us. You might be financially settled in life but it is always wise to be prepared for all contingencies. This is why you need an emergency fund in place, either in a savings account or by way of other investment options so that you can access them in times of need and protect yourself financially.
When moving towards financial independence, it makes sense to create and prioritize your goals in terms of finance for the future. This should include your current financial requirements (short-term goals) as well as keep some room for unexpected surprises (long-term goals) that life may throw at you.
To become financially independent, you need to save enough money for the long term. And savings come when expenditures are reduced to a considerable minimum. Start by finding out your wants and “actual needs”. You’d soon realize that everything that you want is not actually what you need to lead a financially comfortable life. Once you start reducing your wants and thereby lower your spends, you’re likely to save more, eventually moving towards financial freedom.
Sometimes saving too isn’t enough. It is important to invest your money to generate more returns in the future. We’ll talk more about the best investment options in India in the section below.
This is best ensured through insurance. Buying an insurance plan for yourself and your family is not an option anymore; it is an absolute necessity to a secure future. Mishap can hit any person, anytime, anywhere. You can only be prepared in advance to face life’s uncertainties. Insurance helps you stay financially covered in the face of a mishap.
Here we list some of the top investment options in India that you can consider to create a decent wealth corpus for the future:
1. National Savings Certificate (NSC)
2. Public Provident Funds (PPFs)
3. Post Office Monthly Scheme
A fixed-income scheme backed by Government support, it is highly preferred by most investors owing to the no-risk factor. You can easily buy the NSC at any public or private bank near you as well as all post office branches. The interest payable on the investment is compounded every year by the Ministry of Finance.
Yet another government-backed investment scheme, it is one of the best tax saving investment options in India. The best part about this plan is that investing in PPF is free of tax payment; moreover, the earned interest on investment is also exempted from taxation.
This is a more reliable way of earning regular income and is often regarded as one of the best multiple income options for many people in the country. An account can easily be opened in any public office branch near you. You can also choose to open a joint account with your spouse or minor kids. Interest is paid on the investment amount every month and this is what ensures regular flow of income under the plan.