Gaining financial freedom is not an easy, however, it is something anyone can do. But how do you get started? It’s obvious that one must make a significant amount of money if they expect to retire.
But “making” money doesn’t mean a thing if you don’t know how to save it.
Penny pinching, coupon cutting, or telling your friends you’re on a budget isn’t the sexiest thing to do. If it was easy, everyone would do it. It is essential that you follow the 3 rules of frugality to begin your journey to financial freedom. If you can stick to these 3 rules, your life won’t be complicated.
Saving in these three categories will allow you to spend money on other things and not feel bad. Like a good chair, you need at least 3 legs for stability. If you aren’t keeping track of these 3 categories, your financial stability tip over and collapse. Before we get started, take a look at your budget and see if this is the case…
1. Food
Ah yes, the 3rd biggest money waster of Americans. Don’t believe me? Check your latest credit card statement. I’ve spent too much money on food in the past, I’ll admit it. I’m not advocating you stop eating, or even stop eating quality food, but if you can cut eating out in half, that’s not only money you can save, but money you can invest. The reality is by not paying attention to the money you spend on food you don’t need (eating out), you are spending hundreds of dollars you don’t need to.
2. Travel
Now before you assume that this is “not worth it” you need to ask yourself how bad you want to be financially free. Because of the decisions my wife and I have made in regards to transportation, we will be able to buy a house this year as college students. While watching your food budget can save you hundreds, your travel budget can save you thousands. Are you driving a car when there is a free/cheap bus you can take? Have you considered riding a long-board or bicycle? If you need a car that’s ok, but you better not be financing a car unless you have done your research and have found that it is worth it for you. Financing a car not only makes you pay more for interest, but it also puts you in a hole of debt. Driving a fuel-efficient, used car, that you paid cash for is going to save you a lot more money than you realize.
3. Housing
It’s no secret that our biggest expense is housing. You could be frugal in all categories listed above, but if you are paying more than you can afford for housing, then you are not going to save any money. Right now our country is in a housing crisis, but everyone should consider renting a cheap apartment now. If there isn’t such a thing as a cheap apartment consider living with family, or sharing a room/apartment with a roommate. These short term decisions will save you thousands of dollars over the long run.
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