Financial Freedom and Saving for Retirement

Attaining financial freedom has always been my dream. I have been learning a lot about managing finances through so many financial resources, may it be online or books and I also attend seminars about personal finance whenever I get the chance or opportunity. Learning about how to open ira is also very useful. We don’t want to be a burden to our children when we retire right? So saving up for retirement is a must so we’ll not end up broke when retirement comes.

There are a lot of things to do before achieving financial freedom. It is not as easy as it appears to be. It involves hard work, discipline, perseverance, commitment to ones goals. The first step to financial freedom is to eliminate all bad debts that we have. Bad debts take away money from our pocket and the law of compound interest works against us if we have bad debt. The next step is to save up. For me, saving up 20 percent of our gross active income is ideal. Save up around 6 months to one-year of salary for emergency in case we lose our job. That way, we have something to spend while we look for another job. Then also set aside funds for healthcare. It is also advisable to get health insurance so we can use it when necessary.

The next thing to do is to invest. We need to invest some of our savings in order for it to grow. Investing in diverse portfolio is what financial experts advise. As the old adage says, “Do not put all your eggs in just one basket”. Then strive to get multiple income streams and create passive income. By doing all of these, we can achieve financial freedom.

Helpful Tips to teach your Child to Manage Money

Well, Its never to early to teach your child the value of money, here are some practical tips on teaching your child to manage his own money.

• Money Jars. Divide clear jars (since kids are visual) for different purposes, such as short term (weekly) and long term (money you can physically put in the bank) purposes. Discuss with your child what these are for and how the money saved will benefit him int the future.

• Have a field trip to the bank. Bring him along when you deposit his money so he has a concept of saving, and explain where the money will go to, say for his college tuition or birthday party.

• Chores. Encourage regular age appropriate chores (packing away of toys, setting the table, etc.) something your child can do well without Yaya's help. Let him earn his money.

• Money monitoring. Ask your child to write down in a small notebook all his expenses. This way, you can monitor how responsible your child is and what his needs are.