Financial independence is a huge concern for the newly minted adult. You want to be able to pay for your own housing, your car, and the rest of your bills. And it shouldn’t be too much to ask to have a little extra to spend on fun, too. Fortunately, financial independence might not be as far away as you think. It takes planning and perseverance, but you can achieve this milestone.
Consider Getting a Graduate Degree
Maybe you’ve just finished college, and you’re finding that the job market is tough. Would a graduate degree help with that? Depending on your field, it might. Healthcare and education are two fields that prioritize graduate students. You can earn significantly more if you get your master’s degree. Then it’s a lot easier to pay off both your undergrad and graduate student loans. Financing grad school isn’t impossible, either. You can apply to have as much covered by federal loans as possible. Whatever costs are left over, you can take out a private student loan. You’ll want to compare different offers to find the best rate possible for your credit score, needs, and repayment time frame.
Make a Plan to Be Frugal
Here is a commitment you will need to make today in that you will not live beyond your means. In fact, you will live below those means. That means that you’ll get only what you need and spend your extra money only on things that make you truly happy. Maybe you’re able to get a job paying six figures. That’s great, but can you live on less than that? The lower your rent and other bills, the more you can put into your savings. Not only will this make you more financially comfortable, but it will help you be prepared in case of a potential disaster. If you’re between jobs for any period of time, you’ll want that cushion keeping you afloat.
Invest Everything Outside the Safety Net
Once you’ve established a solid safety net, it’s time to invest whatever’s left over. Your bank account probably doesn’t give you the most solid interest rate on your savings. But a robust investment portfolio will allow your assets to grow over time. You should have some money invested in retirement already. But you might choose to make investments outside of that. As your personal portfolio gets larger, you’ll be closer to that independence.
Some people have enough money invested that they can live off the growth. You won’t need to worry about keeping a job you dislike, because you can just live on your investments. You’ll be able to pay off your debts and chase the dreams that really matter to you. On a similar note, it’s good to keep investing no matter how volatile the market is. Some assets should go into stable holdings, while others can be invested in riskier ventures with greater potential rewards. It’s possible to hire an investment advisor who can help you determine the best allocations for your assets based on your goals and income.