What else can you do to help yourself move toward financial independence? For one thing, don’t become dependent on “hot tips” or other questionable financial advice about The Next Big Thing in the investment world from so-called experts who often have poor prognostication records. Even more importantly, though, their advice may simply be inappropriate for your needs and risk tolerance.
Finally, consider these two suggestions: Maintain adequate liquidity and keep your debt levels as low as possible. By having enough cash reserves to cover unexpected costs, such as a major car repair or a new air-conditioning unit, you won’t have to dip into your long-term investments. And by keeping your debt payments down, you’ll have a stronger cash flow, which means you’ll have more money available to save and invest for your future.
Each one of these suggestions will require a commitment on your part, along with a clear focus on your goal of financial independence - there just aren’t any “short cuts.” But with a consistent effort, you can keep moving along on your journey toward your own Financial Independence Day.
Brian Humphrey is a financial consultant and investment advisor.