3 Key Steps to Achieving Financial Independence

Estimated Reading Time: 5 Minutes

What would you do with a million dollars? If you had three wishes, what would you wish for? What would you do if you woke up tomorrow to the news that you just won the lottery?

All of us have thought about how we’d answer these questions at least a hundred times, and inevitably, majority of us would answer them in a way that supports some sort of financial independence. In reality, it’s a pretty common goal we all work hard to achieve – and we’re all constantly in search of quick tips & tricks to guide us in this endeavor.

A quick Google search will pull up hundreds of books, online blogs, and videos dedicated to doling out advice on how to achieve financial independence, and they all agree: unfortunately, there’s no quick trick to achieving that particular goal. But your customers shouldn’t lose hope!

There’s a few simple (enough) tips your customers can take into consideration to help them on their financial independence journey.

“Financial peace isn't the acquisition of stuff. It's learning to live on less than you make, so you can give money back and have money to invest. You can't win until you do this.” – Dave Ramsey

Visualize the goal

Most financial advisors would agree on this first tip. Consumers should consider what type of lifestyle they want to have (or maintain). What do their days look like? Are they traveling multiple times a year? Do they have any dependents that still need their support? As you know, it’s important for your customers to visualize what they want their future to look like so they can better determine the amount of money & resources – as well as time – they’ll need in order to get there.

Make a budget

This step is crucial for your customer’s financial independence journey, and one of the easier ones to start. However, sticking to the newly created budget is the tricky part. That’s why we recommend your customers create a realistic budget that will make them happy today, as well as in the future. Especially considering that as your customers salaries increase with each promotion and company change, lifestyle inflation tends to increase as well.

Creating an unrealistic and extremely aggressive budget will just set consumers up for possible disappointment down the road, and will likely cause them to believe that achieving financial independence is too difficult and unattainable – which isn’t the case. Advise your customers to create a budget that still allows them to enjoy life now (not in excess, of course), as well as one that will help them enjoy life the way they’re envisioning it later on. Because, let’s be honest: the average adult can only eat small packets of ramen noodles so many times a week…

Use the right tools

Your customers should also consider the types of tools they can use when deciding how much money to save, how long it’ll take them to reach their financial goal, etc. Using the right tools will make their lives, and the task of deciding what is needed to reach their goal, much easier. Here are a few they can use to help them get started:

Time to Financial Independence Calculator – Mr. Money Mustache, a popular online blogger, shared this calculator to help consumers determine how long it will take them to reach their unique financial independence goal. Although there are several other online calculators that serve a similar purpose, this calculator in particular considers their yearly expenditures, current net worth, and savings while also taking into account accrued interest and annual inflation.

Financial Planning Tools – There are a number of well-known companies that offer free budget planners and trackers to assist consumers in staying on top of what they’re spending, and how much they’re spending on those items/experiences. A good budget calculator will not only track your spending habits, but will also share key insights into those habits, and offer suggestions on how to “trim the fat,” so to speak.

Asset Allocation Calculator – All investment plans include at least one mention about investing as a way to obtain financial independence – and we agree. Simply relying on savings with no investment plan will open your customers up to a loss in the long term due to inflation. Consumers should strongly consider using a tool like this calculator from Bankrate to assist them in creating a balanced portfolio of investments.

Identity Protection – It may not feel like identity protection and financial independence are tied together, but your customers can’t reach their goal of financial independence if someone else is using their identity to open fraudulent loan accounts or credit cards in their name without their knowledge. Especially if any of those accounts go into collections.

As more and more data breaches occur, consumers are no longer afforded the luxury of simply getting credit and identity monitoring to protect them from identity theft and/or fraud – it’s not enough. Your customers do need to be alerted to suspicious activity; however, they should also make sure their identity protection service includes compassionate and caring resolution support. There’s no fail-safe, fool-proof way to prevent identity theft; so, if your customer gets an alert about a fraudulent incident, it’s extremely important that they have the expert support they need to assist them throughout the resolution process. Particularly, the type of resolution support that will not just guide them through the steps, but also do it for them – ultimately, saving your customers a vast amount of time and energy.

Support your customers in achieving their goal of financial independence by offering them a comprehensive identity protection service that not only monitors their credit, but also the deep and dark web for any suspicious activity that could expose them to financial and identity fraud. Confirm that the service also includes 24/7/365 access to Resolution Specialists (yes, even during holidays) that are armed and ready to help resolve any potential identity/credit issues. The last thing we all want is for someone to mess up what we've worked extremely hard to achieve.

Request a demo to speak with one of our sales reps, and learn more about the many benefits offering an identity protection service can bring you and your customers.