5 Steps to Take Your Financial Intelligence to the Next Level
Financial intelligence is undoubtedly one of the most important skills in life. Firstly, it helps us successfully manage our finances and secure them for the long term. Unfortunately, financial education is often neglected and insufficiently taught in schools. As a result, many people fall into the trap of consumer debt. But don’t worry, in this article, I will share with you 5 steps to take your financial intelligence to the next level
Step 1: Examine Your Attitude Towards Money
How do you actually feel about money?
Many people have a negative attitude towards money, thinking that it’s evil or should only be spent on consumption. This attitude is often shaped in childhood and can be difficult to change since it’s constantly reinforced by our environment or in school.
However, to improve your financial intelligence, you need to change your attitude towards money and understand that money is just a tool that can help you achieve your goals.
Money is like a woman: Treat it badly, and it runs away from you.
Step 2: Create a Budget
Another crucial step to improve your financial intelligence is to create a budget. A budget helps you keep track of your income and expenses, ensuring that you allocate your money to the things that matter to you.
First and foremost, it’s important to have an overview. Once you have this, you’ll have the best opportunities to reduce unnecessary expenses and invest more money.
Also, include a fixed investment capital in your budget plan. Even if these are only ‘small’ amounts at the beginning, you will see progress over time.
Step 3: Create Assets
What are assets?
Anything that puts money in your pocket. One of the most important steps: Create assets that help generate passive income. This can be achieved through investments in stocks, real estate, cryptocurrencies, or other forms of investment.
Creating assets is a crucial step toward achieving financial freedom. With your passive income, you can continuously accumulate new assets.
Step 4: Manage Your Liabilities
Liabilities are anything that takes money out of your pocket, such as loans and debts. It’s important not to unnecessarily increase your liabilities and to work on reducing them in the long term. Having fewer debts gives you more financial freedom and allows you to allocate more money to the things that matter to you.
P.S. Beginner Mistake #1: You earn more and more money and increase your liabilities in exactly the same proportion. Initially, it’s not about how much you earn but about how much you have left at the end of the day/month.
Step 5: Continuous Education and Development
The final step on the path to financial intelligence is continuous education and development. Financial markets and products are constantly changing, so it’s important to stay informed about new developments and continue learning. You can utilize various resources for this purpose, such as books, podcasts, or seminars, which you can find on this website.
My Conclusion: Achieving Financial Freedom: Tips for More Independence
How do you achieve financial freedom? By improving your financial intelligence and finding a balanced approach between consumption and wealth-building. Avoid unnecessary liabilities and only increase debt when your assets are growing.
Define clear goals and create a plan to achieve them. It’s never too late to start and initiate a change. Take responsibility for your financial future and attain the freedom you deserve.
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About the Author:
Eric Tristan Veszely is an expert in the field of digitalization and future markets. Since 2017, he has been deeply engaged in this subject and has founded and advised numerous companies in the process. His extensive experience in the business world has helped him build a vast network of contacts and opportunities.
Eric currently resides in Dubai, where he continues to broaden his horizons and establish new business connections. His goal is to convey relevant information about future markets and enable people to build passive income or an online business in this sector.