Step by Step Guide to Achieving Financial Independence
Ever since I got started in real estate, I realized I was good at making money. I could easily find a deal, do the project, and make a ton of money on it…
…and I loved to spend that money on nice things, a new truck, etc.
The idea of passive income came to me suddenly one night, but the concept of financial independence was something I developed slowly over the course of a few years. During that time I had to make a lot of hard choices.
- We traded in my amazing $50,000 truck and got a fuel-efficient car (very sad day for me).
- We got rid of our leased car because we didn’t really need it.
- We cut down our entertainment budget and stopped eating out 5 times a week.
- We paid off student loans and credit cards.
All of these things were difficult to do. I realized though, that financial independence has two parts of the equation. I realized that I didn’t just need passive income, I also needed to make sure that passive income exceeded my expenses.
No matter how much I earned, I could never be “free” if I kept spending more and more. I only had half of the equation which is why I felt like I was spinning my wheels and going nowhere.
“I also needed to make sure that passive income exceeded my expenses”
Looking back, I can see the path I took to get here and I realize that I took a lot of detours.
Back when I got started in real estate I didn’t even realize what I was trying to do or why I was doing it. That’s why I’ve put it into a simple 6-step process that anybody can follow. Hopefully, it will help you chart your course and keep you on track along the way.
The 6-Step Process to Achieve Financial Independence.
- Educate yourself. Education is key. You need to relearn a lifetime of bad advice. It’s so easy to want to dive in but without a solid foundation of knowledge, you are taking some big risks.
- Make a plan. People are far more likely to succeed with a plan. Please, write down your plan and goals and review them often.
- Get your finances in order. You need to get your own ‘financial house’ in order before you can be successful at investing.
- Start investing. You need to create your first stream of passive income.
- Buy your first investment property. The hardest part is actually getting your first property.
- Grow your investments. Grow thoughtfully and in a planned fashion to get to FI the fastest.