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Financial freedom eludes so many people these days who by all logical conclusions and observations should have obtained it. Its commonly cited as one of the most important and sought-after goals in life and yet is rarely attained. This article does not attempt to give you a magic formula for success. However, I do share with you the choices that made a difference to me and can, if you choose, put you well on the path to freedom.
When it comes to having a healthy relationship with your spouse involving money, this conversation requires openness, understanding, and realism. After all, if you do not have money for an expensive item, having and maintaining respect for each other is what is important. Saving and working towards buying that dream car can bring you closer together, whereas one person making a selfish, unwise purchase can tear your relationship to shreds.
If you cannot be realistic and consider each other’s feelings, it is going to be a hard rocky relationship.
What is Financial Freedom?
Financial freedom is a word that has taken primacy in the 21st century. It is a term that describes a lifestyle that is organically planned where no one is required to work for income to cover their expenses. Financial freedom suggests that one can be free of the responsibilities of money if he has set a life-defining plan to handle his finances.
Please understand that such freedom does not mean that one is free of debt. However, it contends that debt can be defined as an expense. While debt is a constant financial consideration, a person who has acquired financial independence is allowed to mark the debt as a part of his expenses rather than a weight to his financial goals.
Financial freedom is a misconception about being rich. While some rich people may possess a few million dollars in their bank account, their overhead costs could mean that they are not as financially independent as they seem. Therefore, financial independence is a concept attuned to your lifestyle and the amount of money you have to cover it. In this perspective, financial freedom is not as hard to achieve as first imagined.
Matters of finance can strain relationships in many ways, such as when spouses keep secret debts from their partners or, as a recent study showed when wives make more than their husbands. One source of conflict is how differently people are raised to think about saving, spending, and investing.
Money issues also tend to magnify the levels of power and trust between couples. A money imbalance in relationships often causes dating people to separate or can even result in divorce in a marriage.
Do’s & Don’ts of Personal Finance
Do Talk About Money
Hopefully, even before you get married, money should be an important topic of conversation, so that you both understand where you stand. While you do not want to call off a marriage based on your living paycheck-to-paycheck, sometimes, there may be such big issues that you need to.
Therefore, always talk about money before marriage. However, if you do wait, be willing to work through the issues openly and transparently.
Don’t Be Accusatory
When you are discussing money set aside time to talk about it in a safe environment. Accusing your spouse of being ignorant about money is not going to help. Instead, both of you can accept the problems without being accusatory. Simply stating that mistakes were made and now we are going to fix them, and this is how we’re going to fix them, should be enough to move forward.
No one needs to be right or wrong to fix it.
Do Establish a Budget
Once you start talking about money set up a budget immediately. Realize that you can change the budget over time as you live it. However, setting a budget and then working toward perfecting it will help you avoid huge issues later with unplanned spending.
Don’t Procrastinate Budgeting
It remains over my head as to why people avoid budgeting. Perhaps they believe they know where their money is going even if they had no money left before their next paycheck. Most people believe that they are not earning enough to meet their expenses when the actual problem is that they are not budgeting their spending.
The sooner you put a budget in place the sooner you can avoid any problems in your relationship regarding money. Avoiding putting a budget in place only causes poor spending and never helps any money problems at all.
Do Select Contributing Roles
There are cases in a marriage where one spouse is better at budgeting and planning for the future. It is okay to allow the one who is best at it to do this job. It does require that the other spouse is willing to let the spouse who is better with money make smart financial decisions.
Don’t Be Uninformed of Family Finances
Even if one spouse is in control of the finances due to them being better at it, do not avoid knowing how it all works. You should know how the budget works and why it is in place and how it’s working out throughout the years.
Do Include Priorities of All Family Members
When you have kids, your budget should change to include your children. Every family member will have different priorities and needs that others may not have. If it fits in with your financial possibilities, all needs of every member should be accounted for.
Don’t Make Others Give Up Important Priorities
Sometimes the person in charge of the money in a family forgets about the others. At some time, each family member should be able to do or get something special for themselves. Any time favoritism is shown towards one person, everyone else will feel that they do not really matter and may even feel unwanted or appreciated.
Make sure everyone gets their fair share of attention and feels valued.
Do Keep Good Financial Records
Any record-keeping system should be accurate, reliable, easy to follow, consistent as to the basis used, and very simple. Good record keeping is vital in regard to meeting the financial commitments of the family household or business. Additionally, it should provide information on which decisions for the future of the household or business can be based.
Hence, every family member should be keeping records of their expenditures. They should be able to show how they are contributing to the budget and helping stick to the budget. Having a place to turn in debt and/or credit card receipts each day can help.
Don’t Hide Finances from Your Spouse
This seems like a no-brainer, but it is astonishing how many spouses lie to each other, often by omission, about how they’re spending money and what they’re buying. Just stop it. Even if it is a small expenditure, you should own up to it and not be worried about sharing. Hey, you are both adults.
Do Provide Pocket Money for Each Spouse
No matter who earns most of the money, and even if it is all the money, each person should be given an equal amount of money to spend on whatever they want to spend it on. Even if you have a small budget, $25 a month each can make a huge difference.
Don’t Micromanage Your Spouse’s Money
When you designate pocket money, it is important not to tell the other how to spend it. Of course, there can be guidelines such as this is for gifts, coffee, personal care, or other things that are not part of the joint budget so that expectations are understood.
Do Set an Allowance for Kids
Consider giving your kids an allowance of some kind that they can use for the things they need and a little of what they want. This will teach the child how to handle their money including investing and saving.
A commonly used rule of thumb for paying an allowance is to pay children $1 to $2 per week for each year of their age. Following this rule, a 10-year-old would receive $10 to $20 per week, while a 16-year-old would get $16 to $32 per week.
Don’t Overly Control How They Spend Their Allowance
Again, other than a few guidelines do not micromanage how your child spends their allowance. Even if you know they need to save some of that money for their field trip if they don’t do it, don’t bail them out. They need to learn.
Do Get Professional Help
One way to help cut down on money issues is to get professional help setting up a budget and talking about money. Not everyone was taught how to deal with money or the best way to set themselves up for success. That is not a bad thing if you are open enough to find professional help.
Do not Avoid the Issue
Avoiding money issues is the worst thing you can do. Time goes by relatively fast when you are looking back on it in hindsight. If you avoid the issue, 20 years could pass by, and you have lost 20 years of compound interest.
You Can Achieve Financial Freedom
Many people think it is impossible for them to earn $100,000 – $250,000 or even $1,000,000 a year working from home. Most folks dream of working for themselves and fulfilling their financial dreams, but then the barriers pop up in their minds. People in general think whatever they are making or doing is all they are good for.
But the truth of the matter is, you can make whatever amount you want. It’s your decision; the only one stopping you is you. Because there are successful entrepreneurs making those incomes and more.
If you believe you can do it, you can. However, if you believe you cannot you certainly will not. So instead of rationalizing about what you cannot do to reach your goal, think about what you can do to reach your goal.
Think about what you can do to make it happen.
Visualize yourself as having financial freedom; picture it in your mind. All the power and ability you need are there within you. Believe that you have the capacity and power to attain money-making success, and you are halfway there.
Enjoy Final Independence
Financial freedom does mean matching the objective of fulfilling one’s goal of financial security with the strategies needed to attain it. For instance, can you comfortably pay your bills and save the money you need?
Being able to work together in your relationship regarding money is a good sign regarding your ability to work together on other topics too. Money is often the hardest one in which to get on the same page together.
We live in the information age, today everything you need to reach your goal is only a click away. Personal Development eBooks, how-to home-based business opportunities, with easy-to-follow instruction. Best of all you can get all of that with little or no money out of pocket.
However, financial freedom is certainly possible if you are both honest and want the best for your future.
Related Article: The Dos And Don’ts Of Developing A Healthy Relationship