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How can a family achieve financial independence while raising children?

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Alison Pearson
Alison Pearson
Alison Pearson is an interior design student. She is a writer and designer, and her ultimate passion is art and architecture. She is also a bibliophile and her favourite book is “The Sound and the Fury” by William Faulkner. Follow her on Twitter.

Gaining financial independence is not easy to achieve, even when you live on your own and take care only of yourself. So imagining being financially independent with kids on board might seem even harder to reach. However, the right advice might bring the independence you desire.

Learning how to navigate money matters as an adult takes time, practice, and learning. However, the sooner you start learning, the faster you will be able to earn the means to completely cut off support, be it the one from your parents and family or the institutions. FIRE (Financial independence, retire early) is not a dream. Here is how to navigate your way towards financial success.

Outline your goals

The most important part of the plan is to know what you want to achieve. Your dreams will be the fuel that will guide you through the measures you will take while going for the desired independence. Think about your dream life – where do you live, what is your position, how many rooms does your dream home have, where do you go for the weekend, and even what to eat in a day. Each of these has a price tag attached to it.

To achieve these goals, create an ideal timeline of when will you reach which goal and open to the next, greater one. The timeline will be your vision board, so be free to make it and look at it.

Count how much money do you need

All of your daily and monthly expenses come with a price. These are important to plan as they will play a role in strategizing your financial independence and your dream life. 

Create a monthly bill you will need to cover once you get to the desired point in your life. If you are not certain about the price of utilities for a certain property, you can look those up online. The estimation of the utility bill can be a part of the price for the property, the car, the yacht, or even average monthly costs for businesses.

Start learning about investing 

You are never too early to start learning about money. Start with the podcasts or books about money and the philosophy of money, and then switch to the business and investing literature. You will be surprised at how much your mindset will change once you learn about a healthy relationship with money and the attitude towards spending and simply having money.

Bonus tip: To secure your children and take care of many of what if’s that come with being a parent, don’t be afraid to look for advice. The best advice for legal matters, especially if you are in separation, will come from the family lawyer. To ensure you have the support when you need it, choose a local office, like family lawyers from Sydney for people from there. 

Cut expenses to gain financial independence

Once you establish the wants, establish your needs at the moment. What are your real family expenses? Write down every cent you and your family spend in a month. Create a list of necessities, and follow where additional money is spent. Make some wiggle room for those, or cut these out completely.

Once you’ve dealt with the expenses that are leaving you financially dependent, you can start saving up. Depending on your visual board timeline, you might even consider making a savings bank account where you will only store money. The other way of saving money is also a sustainable one. It comes with saving money on utility bills, especially saving on electricity. 

Live off half of the pay to pay off debts and start saving

There is a rule of 50/30/20 for budgeting. Spend 50 percent of your income on your family’s needs, direct 30 percent towards wants, and leave 20 percent to cover debts, credit cards, or other repayments. Once you cover your debts, redirect those 20 percent and everything you have at the end of the month towards a savings account. By the time you gain enough knowledge and apply the new knowledge, you will have enough money to start investing.

Many FIRE families use this approach, as it is easy to navigate and follow through once the monthly expenses are sorted. The most important rules to gain financial independence are to be persistent, stay patient, and take care of your health to avoid surprise expenses. 

Consider side-hustle

Another way of creating additional income is to work two jobs. The FIRE movement coined two strategies: Barista FIRE and Coast FIRE. Barista is the strategy that includes working part-time jobs that cover expenses, as you don’t need to work a full-time job for substantial income. The Coast FIRE strategy involves investing early and thus also starting to live out of earned interest early. It’s based on the compound interest, commonly called interest upon interest. This way, your interest earns upon your interest.

Your side-hustle can also be starting your business which is the start of your dream job from the visual board. In this case, be certain to polish your skill continuously and explore the market meticulously. 

Financial independence doesn’t need to be only a dream. Learn, do the work and create your dream life. These tips are only some of many you can choose to apply but start now. How do you plan to start? 


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Alison Pearson
Alison Pearson
Alison Pearson is an interior design student. She is a writer and designer, and her ultimate passion is art and architecture. She is also a bibliophile and her favourite book is “The Sound and the Fury” by William Faulkner. Follow her on Twitter.

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