Ready to be financially free? Do you crave for passive income? I don’t know about you but I am always thinking about how to set up additional passive income streams so you can achieve financial freedom as soon as possible
Before we delve much deeper let’s get to know each other. I was born and raised in Chandigarh (India) in a middle working-class family. I was raised with a belief – “Study well, Get a good job, Life will be great.” So I did and became a software engineer.
Soon after graduating from Bachelor’s of Computer Science I started my career as a software engineer at Bloomberg. In 2008 when the subprime crisis hit wall street like many others I did lose my job. This event hit hard as I was Paycheck poor at that time.
I realized that I make a six-figure salary but I have no clue about Managing Money. Part of the reason was our schools don’t teach us how to manage money. There is too much focus on Making money but no emphasis on Managing money.
That’s how I embarked on financial freedom journey and taught myself early retirement and passive income strategies. In the past, I have also been an entrepreneur I founded KodeSphere with my long-time buddy Vikas Gupta and built quite a few products. Most of the products that we built didn’t do very well except Proofhub which has been sold.
Five Steps to Financial Freedom
With a lot of thinking and effort I have come up with a 5-step guide to financial freedom:
Know your cashflows/Make a Budget
The first step is to understand your money flow – Your income and expenses. Remember, visibility into the cashflow is essential to financial freedom.
A budget is telling your money where to go instead of wondering where it went.Dave Ramsey
As Warren Buffet says – “People buy things they don’t need with the money they don’t have.” If you are a credit card user make sure you read – Good and Bad about credit cards You need to control impulsive buying and make sure you use credit cards to your advantage. If not used right, credit cards can push you into the debt hell
Get Rid of Bad Debt / Debt FREE
Those who don’t manage their money will always work for those who do.Dave Ramsey
Nothing hurts your early retirement plan more than debt. If you have debt take steps to get debt-free as soon as possible. But before you do that first understand the difference between Good Debt vs. Bad Debt. You should focus on wiping out the bad debts.
Pay Yourself First / Invest Right
Saving and investing money early will help you grow your retirement nest. Start saving early, save regularly, and invest in the right instruments.
Warren Buffets Two Rules For Money:
1. Never Lose Money
2. Never Forget Rule No. 1Warren Buffet
One strategy that worked for me – pay yourself first before you start spending. Trying to save after you take care of all expenses is hard. Saying No to yourself is the hardest thing but if you take the money off from the top and invest and only keep the balance to spend it would be easier.
Try to save as much as possible start with 10% every month and increase it to 50% or more.
Create (multiple) Passive Income Streams
Saving, Investing, and reducing expenses is a good start but financial freedom requires setting up passive income streams. The real freedom comes when your money works for you. Here are some ideas for making the passive income that you can start right now.
Rinse & Repeat
Last but not least keep repeating these steps until you reach your financial freedom goals.
If you are wondering how to follow this plan, get in touch with me via contact us page. I’ll be happy to help.