5 Smart Steps To Financial Independence For Women
Becoming financially independent means different things to different people and requires an effective financial independence plan. But what is financial independence for women and how can you go about achieving financial independence?
For some women, becoming financially independent could mean achieving financial independence from parents or financial independence after divorce. Other women may want to achieve financial independence and retire early.
Women who achieve financial freedom, meaning they do not have to work for an income, are usually those who receive a passive income from the money they have invested.
But, in the context of women and financial independence, it usually means being economically independent so they don’t have to ask their parents or spouse for money.
Women's independence is all about having the freedom to make your own choices and for most self-made women, achieving financial independence requires some amount of financial education and awareness.
According to the Motley Fool website, being financially independent requires a smart savings target of between 28.5 to 31 times your projected annual spending.
But creating a financial independence plan according to this financial independence formula may not be easy, or even possible, for those who spend a lifetime barely making ends meet.
You must first figure out your personal reason for achieving financial independence - early retirement or freedom from the control of other people.
Here are some steps to financial independence that you can start implementing right away.
#1. Increase your income
In order to save more money, you need to earn it first. Starting to earn an income or increasing your existing income is the first step to becoming financially independent.
There are many ways you can start earning money from home or increase your current income so that you’re earning enough to meet your monthly expenses and save money too.
Housewives interested in becoming financially independent from husbands can choose from a number of careers for housewives that can help you find the best online jobs for housewives sitting at home.
If you already have a job and need a side-hustle for women to earn extra cash, these side-hustle ideas will give you creative ways to earn money online.
You can also get remote certification and become a Certified MARS Partner with MARS by SHEROES, so you can apply for remote positions with top companies in India.
#2. Create a financial independence plan
If your goal is early retirement, the FIRE financial independence plan could work for you. This is a retirement planning movement called Financial Independence, Retire Early (FIRE) based on a program of dedicating up to 70% of income to savings.
Although the FIRE financial independence plan may seem extreme and require frugality, the principles of FIRE investing - such as increasing your income, decreasing your monthly expenses by living a simpler life, and saving regularly - are good financial practices for most of us.
The only problem with the FIRE financial independence plan is that, should the value of your retirement fund decrease (and it often does) due to recession or a financial crash, you may need to get back into the workforce.
Another way to achieve financial independence, and not have to depend on others for money, is to earn money doing something you love (so you never have to retire), and just use the FIRE method to save money for emergencies or a rainy day.
#3. Start earning a passive income
Passive income is the income you earn even if you stop working. One way to earn passive income is as an insurance agent or financial consultant. Once you sell an insurance policy, you will earn a commission every time your client pays their insurance premium.
As an independent financial consultant, you can sell enough insurance policies so that, even if you have to stop working for some reason, your income from the insurance policies you have already sold will keep coming in.
Read the life-changing, financial independence stories of women who are earning a very good income as financial consultants.
The best thing about becoming an independent financial advisor is that you don’t even need a degree or any experience. All you need is a 10th pass certificate, a PAN card, and a bank account in your name to apply for a financial consultant job.
#4. Invest your money wisely
Another way to earn passive income and achieve financial independence is to invest your money wisely. For instance, if you invest in real estate, you can earn a passive income from rental income.
Depending on your risk appetite, you can invest some money in gold, mutual funds, fixed deposits, or any financial instrument or asset that gives you a good rate of return.
Not sure how planning for financial independence works or which are the best investments to be financially free?
You can consult independent wealth planners or join the Money Matters Community and get independent financial advice from an independent financial advisor.
#5. Earn multiple sources of income
A smart financial independence plan will also include a provision to help you earn income from multiple sources, such as your job, investments, and any side-hustles or businesses you start in your free time.
The reason for this is, should one source of income dry up, for instance, if you lose your job, or if your mutual fund returns decrease, or if inflation decreases the value of your passive income, you won’t be left without a source of income.
To build new sources of revenue, you could start an online business from home with these zero-investment business ideas for housewives.
You can also earn money online without investment - and with only your mobile phone - with the SHECO business opportunity in India.
If you’re willing and able to invest some money into building an online business, you can learn how to make money blogging with this step-by-step guide to blogging for beginners.
Economic independence of women is important as women need financial independence in marriage, so they don’t have to depend on others for their financial needs. For a female, financial independence and becoming financially free can transform her life.
If you value your freedom and security, these ways to become financially independent can help you create a financial independence plan and become a financially independent single woman or a financially independent housewife with her own source of income.
The road to financial independence may not be easy, but it’s an important factor in women's independence today. These steps to financial independence for women can help you earn and save wisely to ensure a comfortable life and retirement.
So choose financial independence, women, and celebrate a Happy Financial Independence Day!