Whether you’re just starting out in your career, or you’ve built up a resume any company in your field would express interest in, the idea of living life on your own terms is incredibly appealing. Imagine saving enough money to be your own boss and not having to answer to anyone but yourself in terms of how you spend your time.

While this paints a rosy picture, human nature makes it easier said than done. It will always feel better to buy what you want now than to hold off in the financial interest of your older self decades down the line. This is because a steak dinner or luxurious vacation is much more tangible than some vague sense of what your future will hold.

Though it’s a challenge to think long-term, it’s by no means impossible if you break the process down into easily digestible steps. Let’s go through them one by one:

Outline Your Goals

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You’ll only be motivated to save money if you have a clear sense of what you’re saving for. If you understand the rewards of reaching the finish line, it’ll be easier to do whatever it takes to get there.

There are no restrictions on the goals you can choose except that they should fulfill you. Why else would you put money away every month for decades if not to engage in the activities that make you the happiest? Before putting your first dollar away, take some time to narrow down your options. What are you thrilled to get out of bed for in the morning? Is there anything you can see yourself doing for free for the rest of your life?

Once you find your answer, you’ll realize that financial independence is not a goal in itself, but a means for you to pursue your passions at your own pace. The question then becomes, how much money do you need to cover your expenses well into your 70s, 80s, or even 90s—a prudent age by financial planning standards—so that all you have to worry about is what to do with your time?

Plan for Emergencies

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With life being the unpredictable journey that it is, it’s essential to have a plan when it comes to unexpected expenses in the areas of health care, employment, transportation, and home repair. It’s generally recommended that you keep at least six months of expenses in cash in a high-interest savings account in case such a situation arises.

Though it may take you a few years to accumulate, the effort will be worth it in the end. Not having an emergency fund can pose serious consequences to your financial wellbeing. While payday lenders like GoDay can provide short-term cash flow when you’re in a bind, they should only be used in especially precarious situations that call for more help than your emergency fund can provide.

Live Within Your Means

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This aspect of your path toward financial independence involves delaying gratification in exchange for future consumption later in life. To be specific, any dollar you invest now instead of spending will be worth more years down the line. More on investing later on.

From a big-picture perspective, though, the advantage of living within your means is clear as day. If your lifestyle doesn’t require you to spend more than you have, you’ll never have to depend on payday loans merely to get by.

This challenge isn’t so much about being frugal and shunning any chance you have to treat yourself to a concert, a piece of clothing, or a fancy meal you don’t in the strictest of terms need to survive. It’s more about finding a balance between enjoying your quality of life and saving responsibly to maintain that quality over your lifespan.

Start a Side Hustle

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If you’re young, taking full advantage of your human capital, or your ability to acquire skills others will compensate you for, is by far the quickest way to accumulate wealth. Start by isolating your interests that offer the best business prospects.

  • Perhaps you enjoy the act of writing and have the time to start a weekly blog about a topic you find compelling and people are generally attracted to, such as personal finance, self-help, or the latest news in sports. As your audience grows, you can sell ad space on your blog and reap the rewards of an income stream outside your primary source of employment.
  • Part-time tutoring is another option that’s simple to implement if you have expertise to share and consider yourself a skilled communicator. There are plenty of companies online that allow you to provide this service over Skype for competitive hourly rates. All you need is a strong internet connection and a flexible schedule if your students reside in countries in different time zones.

Whatever you choose, make sure you enjoy it enough to put a few hours in after you get home from your day job. When it comes down to it, you’ll be working overtime, but they don’t call it a side hustle for nothing.

Invest

Any excess money you earn beyond your necessities should be invested in stocks and bonds in a portfolio that matches your risk tolerance. This money will then compound in value, year after year.

The cheapest and most efficient way to invest for the majority of people is to buy indexed ETFs. These investment vehicles are designed to mimic the returns of stock markets in developed and emerging countries across the world. As opposed to actively managed ETFs, which can charge 2% or more of invested money per year, you can buy passively managed indexed ETFs for as little as 0.1% and sometimes less if the issuer practices securities lending.

With a combination of discipline and determination, the life you dream about is well within your grasp. The key is to remember to pay yourself first. In other words, every time you receive a paycheck, a portion of it should go toward funding the life you envision when working full-time is no longer necessary. Once you hit the amount you need to hand in your resignation, the feeling will be incomparably great, because you will have earned every moment of the decades of leisure to come. Just remember to enjoy your journey to freedom along the way.

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