What is up you guys! Welcome back to my channel. I post new videos every single week so be sure to tune in and join the community!
Today I want to talk about how to achieve financial freedom in your 20s and why it may be easier than you think.
For those of you that don’t know me my name is Brad, I am 22 years old, and I recently drooped out of college to continue growing my business and pursue entrepreneurship.
Thank you so much for giving your time to watch this video, I really believe that you will gain value from this. I am going to show you how to reach financial freedom in 3 key steps.
If you haven’t already, please drop like as it helps me to reach more people.
Thank you once again for joining me on my journey love you guys and let's get this video started.
So what is financial freedom?
Financial freedom or financial independence is defined as the status of having enough income to pay one's living expenses for the rest of one's life without having to be employed or dependent on others. Income earned without having to work a job is commonly referred to as passive income.
Simply put, if you’re living expenses every month come out to $2500, and you’re making $2600 in passive income, you are financially free.
When you break down the numbers like this, it seems a lot more realistic.
There seems to be a common misconception that financial freedom is living lavish and driving supercars while taking expensive vacations every month.
Let's take a look at the steps to become financially free.
STEP 1: CREATE A PERSONAL BUDGET
So the first step in becoming financially free is to create a budget.
I can’t stress how important it is to create a personal budget. It's probably the most important thing you can do for yourself right now, yet so many people haven’t done so.
Everybody knows exactly when and how much money is coming in every month. Payday is every other Friday and if something is off they will instantly recognize and resolve the problem.
But why isn’t this the case for the amount of money going out? Something doesn’t add up.
To become financially free, you first need to clearly understand how much you make and more importantly how much you spend.
If you don’t already have a personal budget, you may be shocked at how much money you're actually spending.
Before I had a budget, I would spend my money without tracking it, and I wondered where all my money was going!
I remember when I first created my budget and I was shocked how much I was spending on food alone.
At that time in my life, I was spending over 1,000 every month on food! This was insane!
Budgeting will really open your eyes!
According to ABC news the average American spends close to $1,100 per year on coffee alone. Budgeting will help you decide if giving up your morning cup of coffee is worth the savings to put towards somewhere else like paying off debt.
I made it easy for you guys to create your own personal budget.
Open up a spreadsheet and start tracking the amount of money you're spending.
After doing this for a few months you will have a really good idea on determining what your freedom number is.
This is called money management and without it, you will never become financially free.
STEP 2: PAY OFF DEBT
The next step is to pay off your debt.
You may have made some financial mistakes in your past and that’s ok!
But you have to clean up that mess before you can start building wealth.
This means if you have credit card debt, student loan debt, or car debt you need to get serious and create a plan to pay this off.
But you may ask why would I pay that off if I can just make the minimum monthly payments?
STEP 3: RETIREMENT ACCOUNT
The next step is often overlooked and that is to invest for your retirement.
Investing for your retirement is one of those things that you hear people talk about often and you know you should probably be doing it but its on the back burner.
Why is a Roth a good idea?
When you invest in a Roth the money you invest grows tax-free. That means you don’t have to pay taxes on it when you withdraw money in retirement. That’s a big benefit you don’t want to miss out on.
I think once you understand the power of compound interest and see the numbers it will motivate you to start right away.
Let's say you commit to investing $250 every single month for the next 40 years at a 10% interest rate.
Can you guess how much you will have?
Over 1.3 MILLION DOLLARS.
Take advantage of this and get started right away.
![](https://i.ytimg.com/vi/gS9WYdwbcHc/maxresdefault.jpg)