Financial independence: Achieving personal and professional goals

Financial independence is a key life goal for many of us.

What exactly the term means can vary a bit, depending on your own interpretation. But generally, it relates to having enough assets and other financial resources that you no longer need to rely on working for your income.

Sound like a dream? It doesn’t need to be.

Here are a few steps that can help you achieve it.

Set clear goals

Everyone will have different ideas of what they need to have, to achieve “financial independence”, so your goals will probably be quite personal to you.

They might be to have a certain level of investment by a set date, to achieve a level of passive income, or to have set up a particular investment strategy.

Aim for goals that are measurable and achievable and will move you towards where you need to be.

Have a savings plan

Part of that goal setting could be to come up with a savings plan that will see you putting aside a certain amount of money each week or month.

You might do this by working out a budget to show you where you could have surplus, and how much that is.

Often, it is easier to stick with a savings plan if it happens without you having to take a very active role. You could automate the payments to savings or investment accounts so that they happen as soon as income comes into your bank account.

You might decide that every time your savings balance hits a certain threshold, you move some of it into more diversified investments. Some of your savings could be money going into your KiwiSaver or other investment funds.

Make use of your investment options and strategies

Financial independence is likely to require a range of investment options and strategies.

Diversification is often an important aspect of an investment plan, and you might choose to spread your money across a range of investment assets and classes.

You will also need to consider your risk profile. If you can afford to take more risk, it may deliver you higher returns over time, but will come with more volatility.

Diversify your income

A key part of financial independence is often having multiple sources of income, so that if one hits a period of trouble, it does not derail your plans overall.

You might do this by investing in different income-producing asset classes, or even setting up or investing in a business that you can eventually step back from running, but still have income from.

Some lateral thinking may help you to identify further income sources that will help to bolster your financial position.

Track your progress

Schedule regular check-ins so that you can check how you are tracking against your plans and goals.

This can be a chance to celebrate your successes or make any necessary adjustments to keep you on track.

Life, and investment circumstances, do change, so it’s important to regularly take the time to make sure that your settings remain appropriate.

Have expert help

It’s easier to achieve most things when you have someone by your side, cheering you on. A professional adviser can help to ensure that you are on track for your goals and assist you if you strike problems along the way. If you would like to talk about your personal or professional goals, drop us a line.

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.