HOW TO ACHIEVE FINANCIAL FREEDOM QUICKLY (from £0 in 5 years - STEP BY STEP PLAN)

so i received an email this week now normally i get a few of these and i have in the past but this one really caught my attention and i wanted to solve it through a video so this is what it said it said i am 42 i have no pension and no savings and i feel like i'm stuck doomed to live a life of a nine-to-five job with no exit until i die and basically i want to say that this is not the case this is nowhere the case that you're stuck doing what you're doing so perhaps you're seeing videos about time freedom financial freedom people talking to you about investing and you know you do it for five to ten years and that'll be you and you feel like i have nothing i've got my mid-forties or even later and i'm just not going to achieve that so what's the point this video is for you i'm going to share with you how we started at zero with debt in the space of three years it paid off that day but also in five years we were able to build freedom from our jobs we built a business and investments that allowed us to leave those nine to five jobs and have time freedom so if that sounds like the video for you stay all the way to the end [Music] so before we get even looking at computers and calculations we need to work on our mindset first of all so the email came across as this desperate attitude and i get that there's a couple of things we need to realize the moment that i actually realized that money was something we could create that's when our journey actually got quicker and quicker towards the goal of leaving our jobs and then creating time freedom and having a business that supports life so the first thing you have to do before we crunch any numbers and get onto the computer is you have to realize that money is unlimited you can create it we get stuck in the mindset that we earn a living and it's fixed that's all we're worth but that's not the case at all the print money for goodness sakes it's always unlimited supply it's all about then creating ways to get money for our talents and we're going to cover that in this video as well the second thing you have to understand is that time does not equal money again we're so used to probably earning our money through sacrificing our time but what if there's a way to get money not giving up your time i'm really touching upon passive incomes here so the strategy i'm going to share with you in this video is based on developing more passive incomes where we don't give up our time for money but money is created out with our time we're going to focus on that because really we want that time freedom back and then the third thing we've got to concentrate on the way you make money and indeed the way you change your life is actually impacting other people so we're going to focus on also helping other people get what they want in life when you work away to share your talents develop a business develop a way to make money but you're helping others it's the amount of people that you change lives with with your talent then it'll drive your time freedom as well so we're going to cover all three of those things now with these calculations and this strategy so the strategy the first thing first we have to actually look at what do we need to create because often people have these goals of time freedom financial freedom wanting to leave their nine-to-five job but we need to actually get resourceful we need to know how much money will allow us to change our life because perhaps you've been stuck in just doing things on autopilot you're spending you're doing whatever you like you're not really thinking about though how much does your household truly need to survive and also what kind of sacrifices could you be willing to make to allow you to hit your goals faster so that's why i come back to the budget first of all we'll work on the rest let's nail down the budget so if you haven't got a budget template i like using excel obviously i'm on my autopilot spreadsheet system if you fancy picking up a copy of our tool that we created for budgeting financial freedom debt repayment the link is all down below lots of people have bought and enjoy it just the same ways our family use it you've got to know how much money you're making right now and how much you're spending and where it's going so that's why i say a budget is really the first stage in any decision we want to do in life because we've got to use money as a tool to get there so let's assume with our example we wanted to make that 24 000 pounds roughly a year okay that works out as obviously 2 000 pounds when gross amount then you have tax to pay so i'm going to estimate that your take-home pay is roughly 1600 pounds in this example that's what we want to achieve so right now i would literally list down every single outgoing amount and every time you've got an outgoing commitment i would then say my job is to first of all high goal to make it as cheap as possible because i want as little outgoings as possible while i start to work on different incomes that's what we're going to do effectively so even things like your rent your mortgage council tax we can't do anything there unfortunately but your gas electricity water bills any insurance at all your job is to haggle and equally if you have debt as well your job is to make ways to pay off that debt faster so we'll talk through a little bit in that in this example i'm going to assume that you don't have debt we're going to really make this budget as long as it can be now in my example i've kept the minimum amounts that i think seem fair for a kind of budget of about 1600 pounds take home pay a month so i've got mortgage council tax the bills i've also got 150 pounds of petrol you know for traveling about i'm going to assume this is a single person so i've got 250 pounds on food and living of that kind of way and we've got some internet we've got a mobile phone it's always the cheapest deals i've put in here i'm also going to add in a couple of things that you might not see other people mention that are essential the first thing i'm going to draw your attention to is sinking funds so sinking funds are these buckets that we create with monthly amounts that then equal larger amounts that we can pay off annual bills or annual expenses so for example putting aside i've given about 150 pounds in that bucket that could pay off your car insurance in one lump sum so it's cheaper you're going to get a better deal if you pay yearly you could also pay for christmas without going today birthdays it could be any kind of insurance at all is covered the yearly deals are always cheaper so that's why i say create these monthly sinking funds these little savings pots so when that bill comes in you move the money across and you get yourself a cheaper deal that's the only reason we do it we do this with absolutely every yearly bill including our council tax it's paid off in full and so you save once a month towards those things that you know you want to pay for once a year the other thing i want to do on this is still give this person some money towards savings so if you're starting from zero as we want to do with this video you're going to have to build up cash reserves and that means ideally having one or two months of immediate cash if anything happened boom i've got savings so that's why it's going to take us some time obviously it's going to take us a couple of years to have those one or two months but we're committed it's a goal we have to put it in place so you might see this budget and go okay jennifer explain to me what's happening i work off the money stacks method it's my budgeting method that has four key pillars and i call these the four fundamental habits that will change your relationship with money moving forward it will switch your mindset from lack to abundance it will do wonders for your financial future so we focus on spending well that means you know we look at those bills and see where we can scrimp and save notwithstanding the quality but still making it the best deal for us we save well so we save towards the goals that matter to you we also invest or invest in our future so we're creating passive incomes through investments pensions side hustles because we're looking for ways to create more money with our money and then the fourth pillar that you'll see is giving now why i say really essential is habit of giving is it's going to be harder to give a hundred thousand pounds from a million as opposed to one pound out of ten the sooner you start any habit that you know is going to be part of your future and it really changes your character and your spirit the better it's the same with investing and saving don't put it off for a day where you think you'll be good enough or you think it feels okay start now with smaller amounts get used to and giving is a habit for your mindset mainly as well first of all you're going to do good in the world you're going to help others you're going to make a difference in other people's lives outside of your own but you're also going to show that you actually have enough for your needs and if you're like screaming at the tv right now or your computer going jennifer i don't even have enough to save and invest you put some giving in your budget and i promise you great things will start to happen with your money and that's just my 10 pens very unique you know i absolutely love to give as part of our budget and it's really critical now that we do it regardless of what's needed in the world so i really i'm going to encourage you to put those four pillars in place and i have done in this model and then again moving on to this budget i've given the person still a little bit of netflix if they want it they've got some night out money and also because i want to change their future definitely some money for personal development so that's really the money stacks and there's different categories of how you divide up your money now this is a zero-based budget so every pence almost has an allocation and you can see that there's only one pence left over of this scenario so you know definitely with a budget you play around but here's the interesting thing that i want you to see when we look at the totals here essentials and what i could kind of estimate was roughly about 72 of their budget that meant 29 was just on the extra little nice things in life so yes there was food bill in there but you know those are areas that you could really start to manipulate and say actually do i want to go here do i want to try maybe little or aldi and really see where you can make the most of your money because it's the lower the outgoing amount the quicker you're going to hit these goals effectively now the next thing that is so important that people miss out is additional income tracking and what you're going to do with those amounts so we've got our monthly budget we believe you know monthly money is coming in we know it it's our job it's our salary whatever it is it's covering that what happens when additional money comes your way as it always does maybe somebody gives you a gift maybe somebody gives you a tax refund perhaps there's a bonus at work there's going to be these monthly amounts of money that randomly appear that you can't predict and this is why my method of the money stacks is so unique we assume money is going to come to us that we haven't planned for okay that's the abundance of the universe as far as i'm concerned there's always ways for money to come to us and we're going to look after them wisely and so when you're actually doing your budget plan also where you're going to send that additional money that comes your way because this is your key really that you're going to fast track your progress we're going to create incomes of course but this is about right okay all these different incomes what i'm going to do with it and for you that could simply be manipulating in my spreadsheet it could be you know you want to give 10 of it you also want to do maybe 40 towards your financial and time freedom you want to maybe do 20 is actually saving towards your goals and then even you know you want to make sure that you've got a good chunk towards or if i'll make the amounts balanced there we go you want a good chunk towards your personal development so books or projects or anything like that and what i do is i actually log every time i get additional money and then this actually tells me okay you've decided you want to focus on your time freedoms are you going to invest it or you're going to save it or you're going to give some away are you going to buy some new books you're giving yourself permission to also allocate the extra money that comes your way with a particular funding purpose so it's all about what are we going to do to hit these goals and in particular for me we know the time freedom piece is going to be a huge part of this strategy so now that we've locked down what do we actually need to live off this is where also you have a very honest conversation with yourself and said okay could i actually afford to go part-time or change what i'm doing right now so as we said the point of anyone actually feeling stuck and is this all my life is meant to be and i'll never do anything different you know what's going to happen to me is because they believe they've got no choices and i'm actually here to tell you have a lot of choices without realizing there's probably room in your budget to change your life right now with every great goal there's a way to make it happen so when you look at your budget you know how much you actually need to survive to pay the bills to keep a roof over your head and food in your belly could you take that pay cut could you do something different for temporary while you build up other incomes right now and that's why having that budget then allows you to not be gambling with what you want to do with your life do not feel stuck but to say actually i can see a way to make this happen so get those numbers in front of you decide whether you want to make a change right now based on the numbers and if not let's keep moving forward so now that we've locked down our budget we've decided what we're doing with our additional money so we're going to focus on time freedom allocated and also towards our other goals the next thing we have to do is create passive incomes because it's time freedom that a lot of people are after our financial freedom if you like you've got to create ways for money to come to you without giving up your time that's the whole point people feel stuck in their jobs because you have to clock on for eight hours for a certain wage we need to get paid when we're not working so passive incomes of course are where you're doing anything one time and then can sell multiple times so the internet god bless it in the past 20 years has blown this wide open for absolutely everyone if you've got a computer and access to the internet a mobile phone even you can have a business you can have a side hustle so i want you to write down a couple of things when you're starting this your goal is to start working on a passive income okay if we want to hit this metric of changing life within three or even up to five years you're going to have to create additional passive incomes right now we can't just wait on investments hitting a certain amount we need to be generating more money so i want you to write down three to five ways that you believe you could start making money passively it could be can you write books maybe develop them and sell them on amazon could you actually do something on fiverr could you sell your talents and services and obviously if you go on there you might see graphic design work writing books spreadsheets you name it go on some of these paid hourly rate sites but actually see the projects that people do that are not a really rates okay they're even if you want to manage social media or something fun like that people will pay for your talent so go on fiverr and people put our own websites like that another place to look for inspiration is ebay or etsy what about actually creating digital products or digital things you could sell them multiple times clip part posters you know i do spreadsheets because that's what i'm good at but there must be something that you could create that you're particularly talented in even things like i've seen like meditational albums you know people do mp3s you could sell things like that voice over work whatever you think get inspired so about three to five ways that you could actually start making money perhaps or even is something you do in your day job that others want you know even if you're an accountant or a teacher people would be looking for your talents outside of normal hours start to brainstorm and then pick one way that is really leaping out from the page for you and we're going to take that and we're going to explore it further so your goal once you've got that one idea that you believe you could actually make a passive income from we're then going to try and make something that we can sell for between 20 to 30 pounds at the lowest okay so what i'm going to share with you is a strategy of just how quickly you can change your life the whole point as i said at the top of the video was if you can help other people do something in their life that is meaningful and has an impact and changes their life that's when you then can build a business that really can affect a lot of people and your income can really go very quickly and i like to start with this idea of okay what business could i create a product to serve those people that i really want to help so my example is financial freedom so i started a youtube channel to help people on the blog i created products for people like me who were building investments or budgeting or had different dreams like that is there something that you could help reach the people that you want to be part of and you know we can help and then also create something that nobody else has thought about or just some tool or something that could then help them achieve their goals let's say you're a pt why not build a community of people who are wanting to lose weight and then you can create products that help them maintain their macros or meal plans or workout plans or ebooks about your journey or exercises that work for particular routines in the home outside and there you go you're adding value and really the secret is actually starting to build a tribe with people who love you that you're helping and actually adding meaningful things to it they would probably want to buy from you they want to buy a book or something like that so start creating things that allow them to get to their goals and then also give you impact and meaning with your work so let's recap what we've done so far you've locked down your budget you know exactly how much you need moving forward to change your life and also you've locked down your goals now as part of those goals you're working on passive incomes you're going to have to actively create new incomes and also we're going to start investing okay so that's the traditional way as well that people grow their wealth it's not thinking about a savings account with like 0.1 interest it will take you 100 200 years to grow your money to anything decent we need to then give our money to other companies who are then going to give us a better rate of return a better growth on our money and that's where traditionally people use the stock market and commodities where they can give their money to something and then it will grow maybe five seven eight ten percent in a year and that's this then model that we're driving in that's how you're going to achieve time and financial freedom far quicker by finding these vehicles that you can give your money to such as your business ideas such as investing and it will just catapult you reaching your goal quicker so i'm going to take you on to this now spreadsheet and it's just a mock-up to show you what i mean we're going to do these two things in tangent while we're living life right now so the goal is to achieve time freedom in under five years and this is the model that we put in place that actually you know we achieved it far far quicker so the first thing is you're going to be actively investing a portion of your money every single month i showed you that on the budget we're going to start small and build up and then also we're going to develop business ideas that give us a certain amount of money so remember in our example it was about sixteen hundred pounds take home pay so that's two thousand pounds gross roughly every single month so the first side the easy side and the side hustle now that you know you're going to try and sell something that's worth about 20 to 30 pounds and you're going to basically grow your business over a long time so that we then have income that source in another way i have given you this model and the challenge i would give you is try and make 50 pounds a month difference okay so you're going to start with aiming for 50 pounds in your first month then you're going to try and aim to make 100 pounds the next month then 150 and so forth so we're going really slowly and why i say 50 pounds is it allows you to make a noticeable difference in your business quite quickly but also when we're talking about a 20 or 30 pound product we're really only talking about selling maybe two more items a month okay so what i would do in this example is i'm going to assume for the first three months you're just building your business and i'm actually going to have a video very soon that talks about a million pound business idea it's a single page how you can spec up a business and give yourself motivation to get to a million pounds if you want revenue turnover so for the first three months your job and your side hustle is to build a community of people who love you and that you could support with products no other characteristics you don't need to be making money yet if you do that's a bonus but you're just going to have three months of building those people building value to them and working on one product that you could sell for about 20 to 30 pounds if you want to go for 50 pounds whatever you call the shots i'm just giving you a guideline and then every single month from them your goal is to keep making 50 pounds more from the previous month and that would mean actually in 43 mountains total you would hit 2 000 pounds gross pay so 43 months is obviously just under four years you would actually have that total amount i think you would get there far quicker because business is never linear like that it's never i just make 50 pounds i think what would end up happening is you'd start slowly this is what i did you start slowly then within a year you might be a thousand pounds or 1500 pounds and then very quickly you know we're in multiple six figures within three years so i have no doubt that you will get there far quicker as well so you're going to do that as your priority i would say roughly spend maybe an hour an hour and a half a day on your side hustle just build it up nice and slowly no more than that because time flexibility is the key the second thing that's happening and this is the time freedom bit with investing so we're creating passive incomes physically we're going to create businesses but then what about the money that we're still getting from our day job we're going to create another passive income through investing and something that's going to grow our money that other people are working on and you might have seen this table before so all ties down into this number called the fire number which basically means once you've saved out about 25 times your annual amount of money that you need you can then have this investment pot that you can withdraw but four percent from and you would live for life off that money this pot would keep going and growing as long as you had about five or six percent yearly growth on it you could keep withdrawing a little bit four percent and you can live off it so this is what this is calculating now to hit that number there's really the only speed thing that happens here is it's got to be the size of the amount that you're actually investing and then the rate of return that's the two multipliers that will speed up your time basically to hit your financial freedom number so in the example that you saw with the budget you saw that i said the person would be saving about five percent of their budget okay so at the very beginning they're going to try and put five percent of the 80 pounds it was that means and in this table you can see if we had five percent yearly return it's going to take us 64 years to get to financial freedom we saw a nine percent return year on year growth it would be 42 years so certainly putting five percent into investments it's going to take a long time to get financial freedom for this to cover our bills and that's why we're doing two things in tandem and the goal really is to be saving more but also actually replacing our income so what happens is the sooner that we actually build up additional incomes that you see at that you know three and a half year mark we're actually then able to save 50 of our total income because basically we've created 2 000 pounds and we're able to now save all our wage that we're earning that 2 000 pounds we're at the 50 split now that would mean that then we've got at least another you know 15 13 years to hit financial freedom working that but this is why i think this is really special because it's not linear like that and the goal really would then be this switch that you see happening where you actually say well i've hit 2000 pounds with my income business but because it's passive i'm not stuck here okay and very quickly what you see happening is your side hustles when you're focusing on passive incomes rather than income for work you know giving up your time you see very quickly that your day job is completely replaced by additional incomes and i actually think what would happen is within a year or two as i've said in the suggestion in this video that your additional incomes would replace your day job to give you flexibility but also you're going to be able to throw bigger chunks of money at your investments so you can see right here you know if you're saving 95 of your income then you get there within a year that's how quickly it is because you're living off so little amount of your financial freedom number but i know from us that we've been able to pile a lot more money into investments once i actually replace my day job with my side hustles and i really think that in terms of like four to five years if you do this tangent method of investing and working to grow your percentage that you save where possible but also grow your other income sources with passive focus you will achieve this within four or five years where you have real decisions to make but then also you're not worried about how many more years it takes to hit your fire number because you're aware of how you're actually able to create money and then also impact and help others and it then just blows it open as i've shared you know we not only just match my income we retired my husband within a year retired then me within three years and our income has gone from certainly being like 45 50 000 at a time and we've completely smashed that as multiple six figures and that's just like a snowball now because i focus completely on passive incomes youtube books courses i really didn't give up my time for money anymore and i really hope this video if you have felt stuck and you thought you know how do i do this this has given you a strategy that you can actually make happen you know my videos are all geared towards giving you back your time and i want to inspire you as well i don't listen to people who say that you can't do anything you want in life i believe if you have a goal and a hope you will get there and you'll get there far quicker with determination as well so i hope that by sharing this shows you you can have a strategy that within three to five years you could certainly be making some real serious choices and even sooner in your life so you get back your time which is truly what a lot of people want so don't listen to anyone who says that you can't do it i believe you can and we are living proof that it absolutely does happen with the focus and goals so thank you so much for watching today why not check out this video right here where i talk you through another similar topic and also you can hit subscribe follow my channel a little bit longer you'll get notified whenever there's a new video so thank you so much for watching today i'll see you very soon

Channel: Jennifer Thomson

Views: 68,032

Keywords: financial freedom, financial independence, how to achieve financial freedom, become rich, steps to financial independence, early retirement, personal finance, steps to financial freedom, what is financial freedom, dave ramsey, how to become rich, financial freedom movement, financial independence retire early, financial independence retire early fire, how to achieve financial freedom quickly, how to achieve financial freedom in 10 years, mamafurfur

Id: _RNlwM0VzjM

Length: 27min 4sec (1624 seconds)

Published: Thu May 06 2021