It is a Brand…New…Day! Starting today you can make changes in your life that will allow you to find financial independence and retire early. How is this possible? By following the new trend that was established by older millennials known as Fire Movement. FIRE stands for financial independence retire early. What is the basic strategy behind FIRE? Although simple, it takes a lot of effort and constant maintenance, save aggressively and as much as possible now.
To begin with, find ways to increase your income and decrease your expenses. Save, save, save! Find areas in your life where you are spending unnecessarily and places those funds towards saving.
Planning is essential. Each month make a budget and do not overspend. Track your expenses each month or each week if it helps you better control your finances. Try to follow the simple 80/10/10 rule where 10% of your monthly income goes to savings, 10% is for tithe, and 80% is spent on everything else.
Perhaps you can start by simply putting aside $5 every week and then increasing that number as you go. The point is you must find a way to start saving and start now! Get educated on ways you can cut spending and maximize savings. Also, don’t forget to invest as soon as possible in a 401k, IRA, mutual fund, stocks, or bonds. Let your money sit, and watch it accumulate over time.
- Save as much as possible each month
- Don’t spend more than you earn
- Cut Down/Eradicate Debt
- Learn Financial Strategy
- Find a side hustle
Terms to Know and Understand
- 401(k): A 401(k) is defined as a contribution retirement account offered by many companies to their employees. Employees can also contribute to their account via payroll deduction.
- IRA: An IRA is an individual retirement account that allows an individual to save for retirement independently.
- HSA: An HSA is useful when it comes to medical expenses. You can set aside money independently or through an employer that offers it. The funds are used to pay for qualified medical expenses only.
- Stocks: Stocks allow an individual to invest and take a percentage of ownership in a corporation.
- Bond: Bonds are defined as loans that an individual can make as an investor to a corporation.
- Mutual Funds: An avenue to invest by creating a portfolio of stocks, bonds, and other assets.
*Investing Tip: To avoid the fear of investing and losing money it’s best to talk to our financial coach first!
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Breaking Free from Interpersonal Abuse, Overcoming Adverse Childhood Experience and Live, Learn, Travel
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