Intellect is not the only thing that leads to success. Financial intelligence is a concept that many people neglect while growing up. School taught you many things, but your teachers and parents didn’t require you to develop budgeting and financing skills. This is not a skill you’re born with. You obtain it through learning and practice.
The question is: how do you obtain financial intelligence and how can you use it for becoming financially independent in your 30s?
When you’re in your 20s, life is all about living day by day. You’re making just enough money to support yourself and you mostly care about traveling, having fun, and experiencing new things. Most people don’t think about buying homes and starting a family at this point in their lives. By the time you hit the 30s, those questions will arise and if you have a solid financial foundation, you won’t struggle.
Tips: How to Become Financially Independent by Your 30s
It’s important to have a deadline, so you can plan things well and you’ll start taking steps. Otherwise, you’ll assume you have indefinite time ahead so you’ll simply procrastinate the action.
Okay. Let’s say you have five years. What should you do? Here we go!
Identify the Amount You Want to Save
If you want to have $1,000,000 to consider yourself financially independent, it means you’ll have to save $200,000 per year, every single year for five years.
That’s a lot of money, so maybe you’ll want to go for a smaller amount to make it more realistic. With $500,000 in savings, you can consider yourself financially independent. That’s enough money for you to buy a home and make productive investments. So you’ll need to save $100K per year.
Get a Job That Gets You Such an Income
You still haven’t completed your education? It’s about time for you to take care of that. Many students procrastinate graduation and hit their 30s without having things figured out.
If you’re close to graduation but you have the final project to complete, you can get help, too. You can hire an online writing service and just as making the decision: “I’ll ask to write my assignment for me!” A professional writer will work under your instructions.
Now let’s see… to save $100K per year, you need a job that gets you at least $160K after tax. What kind of job can get you that income? If you’re a software engineer, you can get there. Marketing, sales, finance, physical therapy, and other industries also offer good chances for earning that kind of money.
The safe bet is to enter a career in healthcare, technology, or corporate management. But if your education doesn’t make you a good fit for those industries, it’s time for you to consider starting your own business.
Start a Business
Startups are still going big. It’s a risk, but you have great chances to succeed if you start a really good business. Here’s the right way to do it:
- Find out what you can do better than others. Get the needed training, so you’ll become an expert.
- Find a few other people who are just as good as you are. Team up with them and set the foundations for a successful collaboration. They are your business partners.
- You might fail. Many startups do. But do you know what successful business owners do? They learn from their mistakes and start again. They do this until they get things right.
The Secret Recipe to Becoming Financially Independent
There are three important things to keep in mind when wondering how to be financially independent:
- Earn well (by getting a great job or starting your own business)
- Spend as little money as possible, so you’ll save more
- Invest your savings, so you’ll multiply them
You could keep the money you save in a safe place in your home. But that’s not how you benefit from them. You want to think about making investments. The simplest alternative is an S&P 500 index fund. And if you aim for higher earnings, you can invest in real estate.
Remember the secret recipe? Start earning well, start saving a lot, and invest your money in a safe source. You can talk to a financial advisor for advice. Just make sure you don’t invest your money in a highly risky affair, such as gambling. You need a safe option that will definitely multiply them. If you do this well, you’ll be financially independent by the time you hit the 30s. If you do things really well, you could be rich by then.