Unlock Financial Independence by 2025: A Roadmap to Long-Term Stability
Taking control of your finances is a crucial step toward achieving financial independence in the upcoming year. While it may sound enticing, financial independence doesn’t simply mean having endless funds to do whatever you wish. Rather, it’s about using your money to build long-term stability, which, over time, allows you to pursue more of your dreams. Below are seven practical steps anyone can follow—no matter their income level.
1. Make a Personal Financial Statement that includes a left and right column. List all assets in the left column including cash and savings account balances, the current estimated value of your home and automobiles, the value of any stocks, bonds and mutual funds, and any value you may put on household goods like furniture, jewelry, or valuables like your grandmother’s antique bed. Liabilities go in the right column and include your current mortgage balance, car loans, credit card debt and “installment debt” such as a loan taken out to buy furniture or a new zero turn mower.
2. Create a payment plan to pay off any debt outside your mortgage and auto loans. Set a goal of 36 months and start with debt on the highest interest rate loan you have. Every piece of debt you pay off frees up cash to use elsewhere.
3. Increase your mortgage payment by $25.00 a month. While this does not seem like much, over the course of a 30-year mortgage, you could shorten your payments by several years — saving you a substantial amount of interest.
4. Evaluate current subscription services to make sure you aren’t paying for ones you rarely access. Eliminating one subscription service could give you the cash to implement steps 2 and 3 above.
5. Create an emergency fund. An emergency fund is a resource that can be tapped into if an unexpected situation happens that would significantly impact personal income over a short period of time. I would suggest starting with a goal of $500 and build from there.
6. Become a better manager of your time. Try to put everything on a calendar that you have access to on a daily basis. Choose to prioritize the free time you have with those people that offer positive guidance instead of those that are negative.
7. Start or increase your retirement savings. You are never too young (or old) to save for retirement. Retirement accounts offer tax advantages while helping you save for the future. Regardless of when you start or how much you save, the most important step is to get started. Choose an amount to set aside each month—whether it’s $100 of $500—and consider setting up automatic contributions to enforce discipline. Big dreams require steady commitments and time in order to grow. Following these seven steps to change your financial habits will put you that much closer to reaching financial independence in 2025. Happy New Year from all of us at Independence Bank. Independence Bank Village Plaza 65 Mack Walters Road Shelbyville, Kentucky Member FDIC | Equal Housing Lender
1/2/2025
By: Tyler Long
Originally published in the The Sentinel-News