Your Ticket to Financial Freedom in 2024

The power of financial knowledge can liberate you from stress, bad investments and debt. To achieve financial independence first you need to understand your current financial status. It can tell you a lot about where you need to be to have financial freedom.

Having financial liberty is all about having enough earnings that support your lifestyle. Not just that it is also about smart savings and investing. One of the things about becoming financially independent is to know where to invest, what to invest in and how much to invest.

That is why in 2024, you learn how to be financially independent by following a few habits. Find out what they are below.

Steps Towards Financial Freedom

If you are wondering how to be financially independent woman or man, here are a few tips that might get you started:

1. Define Concrete Financial Objectives

The foundation of a successful quest for financial independence lies in establishing clear and tangible financial goals. Take the first step by outlining precisely what you aim to accomplish with your finances, whether it’s purchasing a home, launching a business, or saving for your child’s education. Well-defined objectives offer guidance to your financial decisions.

For instance, imagine saving ₹20,000 over the next five years as a down payment for a house. Break this target into monthly increments, creating a practical roadmap for your financial journey. These distinct goals of financial freedom act as a navigational tool, keeping you on track and motivated to make informed financial choices.

2. Diversify Your Income Streams

Consider cultivating supplementary income sources alongside your primary salary or business earnings. A secondary income stream not only aids in achieving your financial objectives but also enhances your overall financial strategy. Explore avenues such as:

3. Exploring Supplementary Income Avenues

Diversify your earnings by venturing into a side business. If you have a passion for art, consider starting an online or offline art/gifting venture. The beauty of a side business is its flexibility—scale it based on your availability and offer services within your schedule.

4. Establish a Stable Additional Income Stream

Ensure a steady supplementary income through strategic investments. From fixed deposits that guarantee interest payments to property investments generating rental income, explore avenues that offer a reliable and fixed source of extra financial support.

5. Develop Your Investment Strategy 

Another great way to achieve financial freedom is by investing. While there are many types of investments in the market you can choose any one or multiple of them depending on your financial goals and how you want your investments to grow. Here are a few options.

Invest in Renewable Energy Assets

Investing in renewable energy assets presents a forward-thinking opportunity, aligning financial gains with environmental impact. As the world shifts towards sustainability, sectors like solar, wind, and innovative technologies offer promising returns. 

Beyond profits, supporting clean energy initiatives contributes to a greener future. Embrace the potential for both financial growth and positive ecological change by participating in the dynamic landscape of renewable energy investments.

Equity 

Investing in equity is all about “owning a slice of your favourite companies”. That is what equity is all about- getting a share in businesses listed on the stock market. You can learn the basics of buying and selling and invest in the profitable companies in the market.

Mutual Funds 

One of the ways to financial freedom is through diversification. In order to avoid risks in investment, you have to diversify your assets. You can consult a portfolio manager to understand the securities included in the fund. You can also consider investing in SIPs which allows you to invest in small amounts at regular intervals. 

Fixed Income Securities 

Bonds stand out as the most prevalent investment type, ensuring a reliable income stream. By investing in bonds, you secure consistent interest payments and the return of your principal when the bond reaches maturity—a dependable and foreseeable method for wealth accumulation.

Real Estate Investment Trusts (REITs)

Another option lies in Real Estate Investment Trusts (REITs), offering the chance to invest in residential or commercial properties, backed by debt. These investments, whether in houses or offices, allow for income generation through property rental.

Commodities 

To achieve financial freedom,you need to gain exposure to changes in community prices through physical commodities ownership, commodity derivatives or equity in commodity-producing firms. This form of investment means navigating the dynamic nature of commodity markets. 

Hedge Funds or Private Equity Funds 

Such funds employ leverage to finance long and short positions. These funds predominantly invest in illiquid assets and use derivatives. They require a sophisticated understanding of the financial markets.

Fixed Deposits (FD)

Investing in fixed deposits with banks is a conservative approach for investors who like low risks. It provides investors with stability and security, thus making them an ideal choice for those who like to avoid risks. 

Government Investment Schemes

The Government of India offers various investment schemes, including the Public Provident Fund (PPF), National Savings Certificate (NSC); etc. These schemes cater to the various financial goals and can provide individuals with avenues for secure and regulated investment.

Have a Monthly Budget 

The best way to maintain and grow your personal wealth is through creating a monthly plan. Yes, budgeting can help you to stay committed to your objectives and resist the inclination to indulge.

A monthly budget can allow you to even set aside an amount for investing in certain assets. Here is a strategy that you can use- it is the 50/30/20 strategy. This is the road to financial freedom.

Track Your Expenses

 Examine your spending to determine which costs belong in your monthly budget. For instance, there are items that you cannot classify as “needs” or “savings” like your monthly music subscription, movie tickets and other miscellaneous expenditure. 

There are a few precautionary steps that you should know. And that is “SAVINGS”. To create proper savings follow the three tips given below, so you do not have to face any financial risks.

Importance of Savings 

Unlock financial security and flexibility by understanding the pivotal role of savings. Learn how this key practice shapes a stable future.

Emergency Fund

In the unpredictable journey of life, an emergency fund is a crucial savings tool. Providing financial stability during uncertain times, it ensures dignity and freedom. Creating an emergency fund that you can liquidate easily in need is a great way to make you live life with dignity and financial freedom during any hard time.

Retirement Savings

Initiating early retirement savings is paramount. Invest in diverse policies and retirement funds for a carefree and relaxed old age. It will allow you to live a carefree and relaxing life. 

Other Savings Options 

You can seek other investment opportunities other than renewable energy assets, diversifying is the best way to ensure financial freedom. You can have multiple sources of investment returns. You also have backup in case one of your investments does not perform positively. These keep you prepared for economic changes and inflation.

Some of the best options are creating FDs, buying gold funds, investing in renewable energy projects, and investing in real estate and more. 

You, too, can start your journey towards financial independence with the right investment strategies. Start by investing in renewable energy projects that gives guaranteed returns while saving the environment. 

FAQs: Your Ticket to Financial Freedom in 2024 

How can I earn from renewable energy projects?

 By investing, you contribute to initiating renewable energy projects with no initial expenses for consumers under lease or power purchase agreements (PPA). You receive monthly instalments depending on ownership stake.

Should you consider both equity and renewable energy assets? 

Combining these two types of investments can provide a balance between risk and returns, allowing you to capitalise on growth opportunities while promoting sustainability. 

Have you ever heard of a PPA? 

It stands for Power Purchase Agreement, which is a contractual agreement between a power generator and a buyer, typically a utility company. It outlines the terms of electricity purchase, such as pricing and delivery.

What is the 50/30/20 budget rule? 

It is a simple guide to help you save money and even invest your savings in assets. The rule involves allocating 50% of your income towards necessities, 30% towards discretionary spending, and 20% towards savings. 

Are you looking for a secure and predictable avenue to invest your money? 

Consider Fixed Deposits (FDs) as they offer stability, assured returns, and low risk, making them a favourable choice for those seeking financial security. 

Conclusion 

In the pursuit of financial freedom in 2024, understanding the power of financial knowledge is key. From defining clear financial goals to diversifying income streams and exploring various investment options, the path to economic independence involves informed decision-making. Learn more about investment strategies and goals from Sustvest, especially in the renewable energy assets sector.