The Principles of Financial Freedom

The burning wish or desire to be able to invest in any good business of your choice or to do anything you desire with money without having to face financial constraints is called financial freedom.

There is no doubt that everyone who is pregnant with a big vision wishes to have funds readily available to achieve his or her set goals.

Countries all over the world venture into capital projects, business owners source for funds to expand their businesses, individuals also source for funds to start small-scale businesses, while some persons dream of investing in real estate or acquiring landed property, etc.

Financial freedom does not occur by only wishing it, unless you have an inheritance from a rich Dad or Mum otherwise you will have to work it out. Remember, “If wishes were to be Horses, beggars would ride.”

Continue reading as I share my detailed guide on how to increase cash flow and enjoy financial freedom.

Meaning of financial freedom

Financial freedom can be described as having enough cash at hand or in the bank to afford any kind of lifestyle one wants for oneself. It can also be called financial security which refers to a state in which someone has plenty of cash to meet one’s basic needs such as clothing, shelter, healthcare, travel, and still be able to save for future projects without restraints.

The truth is that some people have dreams or visions and the possibility of pulling through depends largely on the availability of funds.

The availability of cash is answerable to the principles of financial freedom. These principles are no respecter of any race, they favor no particular kind of people and have absolutely nothing to do with religious beliefs as they are ONLY answerable to anyone who applies them.

Before we go into all of that, it is important we look at the importance of financial freedom.

Importance of financial freedom

• Financial freedom keeps one away from debt or borrowing.
• It helps you to pay yourself first.
• It fuels business expansion.
• Financial freedom pays attention to the future.
• Provision for self and family.
• Financial freedom reduces stress and depression.
• It makes investment possible.
• Explore the world through travels.
• And also provides protection.

So, having looked at the importance of financial freedom, we will now go into our discussion proper by sharing the principles of financial freedom.

The principles of financial freedom

1. Imbibe the savings culture

One major problem many people are facing today is the inability to save for rainy days. It is quite pitiable that some don’t save for the future, they are of the belief that tomorrow will take care of itself and before you understand what is happening to you, old age or retirement is around the corner.

A savings habit means to have oneself disciplined towards saving money regularly for future investment. Whether you have a project in mind or not, it is very important you save a little of your earnings for you never know what tomorrow holds.

Tips to help you cultivate savings habit

• Have a set target or goal.
• Start that savings NOW.
• Spend less than you earn.
• Concentrate on your needs, wants can come later.
• Don’t be in a spending competition with anyone.
• Don’t buy things that you don’t really need.

2. Have multiple streams of income

In order to increase your cash flow and enjoy financial security, investing in multiple businesses is one sure way to experience financial stability. In this way, you have your two eyes closed and your money will run errands for you.

Multiple streams of income imply that you have income from several sources you have invested your hard-earned money into.

As the world is advancing technologically, Robots are been created that do most jobs humans do and these Robots are faster and achieve more in the shortest possible time. As a result of this invention, many have been laid off from their duties. But, when you have multiple streams of income, you will always have something to fall back on if you fall victim to retrenchment.

Increase your financial security by creating more side hustles for yourself. You can invest in real estate or any profitable business venture with good ROI.

3. Control your spending habit

One of the basic principles that guarantee financial freedom is one’s ability to limit unnecessary spending. And so many factors could be responsible and they are ;

• Lack of plan

To control your spending habits, you must have a target that you want to reach. This vision will automatically checkmate your spending habits especially if you are planning to own a company in the future.

• Avoid temptation

Some persons fall prey to any little thing they see at the market even when that item is not needed at that moment.

To avoid this buying temptation, always make a list of what you need in order of their “Importance” in your scale of preference as recommended by Economists.

• In-ability to separate NEEDS from WANTS

This is where so many people get it wrong. The day you separate your needs from your wants, you will stop spending carelessly and grow your cash flow.

A need refers to something one needs to survive such as food, shelter, clothing, and healthcare.

While want is something people desire to have. Examples, expensive cars, designer clothing, classy shoes – simply put, luxury.

4. Secure insurance cover

It is wise to get insurance coverage for your life, business, and property in case of any eventuality. If you are not ready to lose what you have labored to gather over the years within a twinkling of an eye, seek this protection today.

Insurance refers to a contract in which an individual/company PAYS a premium to an insurance firm in exchange for financial protection or reimbursement of losses resulting from a covered event.

There are different insurance policies available depending on the type of business that you are doing.

Conclusion

Remember that financial freedom answers to many principles, but this paper covers just four out of many. The principles apply both to the high and low classes. For the former, you need these basic principles to sustain what you have and for the latter, the financial principles serve as a guide to achieving your goals and aspirations.