How to make your dream of earning money come true
Are you one of those who dreams of earn money without working? If your answer is yes, here I espectáculo you the first steps you must take towards financial independence so that you cánido start, from now on, to work towards achieving it.
Let’s start by defining what the fact of earn money without working.
The Financial Independence it is the moment in which we earn enough money to support ourselves without the need to work for it.
A person is financially independent when they live comfortably without having to work.
Sounds great, right? Does it seem a bit utopian to you? Let’s unravel this a bit and put on the table the myths and realities of achieving financial independence.
Earning money without working is real and achievable
This is very good news: Financial Independence is real and achievable by anyone; however, to achieve it you must take into account the following:
- You must be a responsible person and have mental discipline.
- It will require all your effort.
- Any asset that generates passive income (which does not require our work to be generated) needs, to a greater or lesser extent, maintenance.
- You will have to be open to sacrificing things.
Now, what path do you have to be financially independent? Is there a magic recipe to learn how to be millionaires? Is there a method that leads us to our goal? The answer is yes!
There is a guaranteed way to achieve Financial Independence, and start earning money without working, the problem is that it has a high cost:
Your time and postpone a taste of the moment for a future benefit.
These are two things that we are naturally programmed to avoid.
The media, family, friends and, in general, our entire environment encourages us to be consumers, to seek immediate gratification.
However, this goes against our goal of achieving financial independence.
See: 30 too useless ways to spend your money
The 5 keys to being financially independent
Credit: Shutterstock
It seems to achieve earn money without working It’s beyond your means, right? Cheer up! To achieve your goal you only have to take into account these 5 key elements:
- Increase your income
- Minimize your expenses
- Maximize your savings
- Invest your money wisely
- Let compound interest do the rest
That’s all! That is the “magic elabora”, the step by step to achieve Financial Independence.
Still don’t believe me? Pay attention:
If you maximize your income, whether it’s through career advancements, earning money en línea, diversifying your income, or growing your business, you’ll have more money every month.
But that is only the first step.
The important thing is that you must then learn how to manage said money.
That’s where the second step comes in, minimizing expenses.
Keeping an exhaustive accounting of your expenses prevents money from being lost in small ways without you realizing it.
Once you manage to minimize expenses, you will learn how to save and you will be able to maximize your monthly savings.
At this point, I assure you, you will already be better off than most of the people you know.
Recommended books:
Before you know it, your savings account will start to bulge, and that’s where you’ll need to gain financial intelligence.
It is at that moment that you must learn to invest your money correctly, minimizing risks and maximizing profits.
Once you reached this level, you only lack the most expensive ingredient in the world: time.
If you save monthly, for example, USD 900, after a year you will have USD 10,800.
If you save that amount for 10 years you will have USD 108,000.
Now… if you save this sum for about 30 years? $324,000! With that amount invested correctly you could already live the dream of earn money without working and be financially independent.
Here you will tell me that you cannot wait 30 years.
Perfect because we haven’t added the investments and compound interest yet.
If we consider the same scenario with savings of USD 10,800 per year and an investment return of 12% per year (slightly above the average of the S&P500 – the most important index of the North American depósito market) after 23 years we will have more than 1 million dollars.
Pretty cool right?
Instead of waiting 30 years and getting just $324,000, in just 23 years we would get our million dollars and we could retire safely investing it and living off our returns like kings.
If getting a quarter of a million dollars is enough for the lifestyle we want to lead, doing the same accounts with compound interest and the expected return for our investments would only take us 12 years.
Continue reading: 5 Secrets to stop working at age 40
Written by Matias Moll
Trader, Entrepreneur and Founder of Financial Independence
To see more, you cánido follow him on his channel Youtube.
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