I have been there and done that!
Planning your finances to achieve financial freedom by your 30s or 40s is certainly an ambitious goal, but with the right discipline, strategic planning, and investing, it is certainly possible. Here’s how you can go about it:
- Save and Invest Early and Regularly: Start saving as much as possible as early as you can, and invest these savings to create wealth. The compounding effect of regular investments can significantly multiply your wealth over time.
- Spend Mindfully: Prioritize your spending. Cut down on unnecessary expenses. Remember, each rupee saved is a rupee earned.
- Invest in Equities for Long Term: Equities have proven to provide higher returns over the long term. If you’re aiming for financial freedom in your 30s or 40s, equities should form a substantial part of your investment portfolio.
- Be greedy when others are fearful: Go for the fences when markets are down and people are panicking. Believe me thats when you can shave off years from your financial independence.
- Diversify Your Portfolio: It is also important to spread your investments across different asset classes based on your risk profile.
- Invest in Self-Improvement: Invest in enhancing your skills and knowledge. This will help you earn more, thus enabling you to save and invest more.
As for my journey, I began investing early in my career, focused on building my skills to enhance my earnings, and saved diligently. Through disciplined investment in equities and periodic rebalancing of my portfolio, I was able to ‘retire’ and ready to start my own company, Jama Wealth, in my late 30s.
The path to financial independence requires persistence, patience, and prudence. As Robert G. Allen said, “How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case.”
Take the first step and keep walking, and remember that it’s not just about financial freedom but about living a meaningful life.
