Category: Uncategorized

How to achieve financial freedom?

Financial freedom is much more than just getting cash. It is the independence to remain who you are and do what you want in life. But achieving financial freedom is not as easy process. By developing specific habits, one can achieve financial freedom.

We all know that money is the only thing which makes the world go round. Financial freedom means self sufficiency or having sufficient savings and money in hand to pursue your enthusiasm, making decisions not affected by your bank account and living on your terms. Financial freedom is much more than just getting cash. It is the independence to remain who you are and do what you want in life. But achieving financial freedom is not as easy process. By developing specific habits, one can achieve financial freedom.

The very first step to achieving financial freedom is figuring out where you are before thinking about where you want to be. List down how much you should save in your bank account, what the lifestyle entails and at what age this will be accomplished and then establish financial mileposts at regular intervals.

 Establishing a written budget and sticking to it is the best way to achieve financial freedom. Try dividing your monthly expenses into three divisions: Essentials, Non-essentials and Junk. Track down your expenses and select categories to prioritize and cut wherever you can.

The next step is to be self sufficient or earning enough to live on your own and being able to provide for oneself. Once you have saved 6 months of your living expenses, you will find enough room to breathe.  Recent research suggests that at this point of time, around 37% of people can handle an unexpected emergency of $1000. Next, you should indulge in saving up a year’s expenses with which you will feel rooted.

While saving up your yearly expenses will give you protection from unforeseen incidents, by saving up your two year’s expenses, you can be flexible with how you want to live. Achieving financial freedom is having sufficient money to protect you for the rest of your life.

Financial independence can be achieved by two ways. One is to save more than a million dollars and then living off the investment interest forever and another is investing in income generating assets like real estate which pay back a considerable amount of money.

Financial freedom cannot be achieved overnight. With each passing year, your financial stress will decrease and your options such as where you live, where you work and what you drive will increase.

Home Buyer Grants and Programs

It may seem daunting to shell out big bucks for your first home, along with a mortgage. Fortunately, there are countless first-time home buyer programs and grants that can assist you to get your foot in the door of home ownership.

Take a look at the 10 first-time popular home buyer programs:

  1. FHA loan: This loan is insured by FDA or the Federal Housing Administration which is ideal for borrowers having low credit scores or only a little money to pay for the down payment.
  2. USDA loan: USDA loan is a loan program which is guaranteed by the U.S. Department of Agriculture and is ideal for low-income borrowers in eligible rural areas.
  3. VA Loan: VA loan is a type of loan which is backed by the U.S. Department of Veteran Affairs for American veterans, military personnel and their families. A VA loan has competitive rates, minimal closing costs, and requires no down payment. However, it requires a low funding fee for some borrowers.
  4. Fannie Mae or Freddie Mac: Loans backed by Freddie Mac and Fannie Mae require a minimum 3% down payment for conventional mortgages which make them ideal for the first time buyers having strong credit but little money for down payment.
  5. Good Neighbor Next Door: This is a HUD program which provides housing aids by providing a discount of 50 percent on a home list price in revitalization areas for pre-kindergarten through 12th grade teachers, firefighters, emergency medical technicians, and law enforcement officers.
  6. Home Path Ready Buyer Program: This is a loan program which provides 3 percent closing cost assistance to the first time buyers to purchase a foreclosed Fannie Mae property who complete a home path educational course.
  7. Energy efficient mortgage: Energy efficient mortgages are backed by VA or FHA a loan program which allows the borrowers to combine the cost of energy-efficient upgrades on a primary loan upfront without a large down payment.
  8. FHA Section 203(k): This is a FHA backed loan which lets the borrowers to borrow funds required for home improvement rolling the cost into one loan along with the primary mortgage.
  9. Local first time home purchaser programs and grants: Many cities and states provide the first time buyers with different programs and grants for closing cost assistance and down payment. These programs generally come with certain income restrictions and have to be repaid once the home is sold.
  10.  Native American Direct Loan: This loan program is backed by the VA loans. This program offer direct home loans to the eligible American military personnel, veterans and their families to purchase, build, or renovate homes on federal trust land.