Clearing out our IOU's

Photo credit: http://www.maaark.com

To be financially free, we need to grow our money. It has to work for us. Yep, we know this. And to start doing this, we need to have money.

If you have debts, this means you're not even at the starting line, you are way BEHIND it. We need to get rid of our debts. Otherwise, we will keep running, without even getting to the starting line first.

Nowadays, it is so easy to find ourselves in debt. The most common is the addicting credit card. Addicting because it is so convenient. You walk into any shop and they accept credit cards. You go online and again, they accept credit cards. You can purchase practically anything using your credit card. Not only that, the cherished credit card gives you time (two weeks to a month) before needing to pay off your purchases! What a steal!

It starts out with a little tiny purchase using our credit card. Then we appreciate the convenience of charging everything to our credit card (yay, no need to worry about the payments until next month!) and we end up charging everything in sight!

We sometimes forget that we couldn't afford to purchase so many things! We think, how can I not afford it when my credit card allows me to pay only a small percentage every month? And so we go along our merry way, burying ourselves in debt.

Hey you, wake up and smell the flowers! The credit card dreamland is actually a trap! It lulls you into thinking that you are "rich" when in fact it robs you of the possibility to BE rich.

We don't actually see that these "minimum payments" is what the credit card company wants you to pay! Because this is where they earn money! The interest payments, over the course of a year, spells about 42% (at 3.5% per month). Imagine that!!! You purchase something worth PHP10,000, you end up paying PHP14,200!

We are talking about credit card debt here. There could be other kinds of debt -- bank loans (car, housing, personal), F&F loans (family and friends loans), school/office loans, etc! These need to be eliminated ASAP!

In the next post, I will share an effective technique on clearing out our IOU's.

Where do I start?!

OK, let's roll our sleeves and get to work.

If you search the internet for tips on how to be financially free, you will be steam rolled by a gazillion ideas which may leave you stumped as to what to do first. All tips are truly excellent! But being bombarded often leaves us paralyzed and decide to not start at all.

Let me try to simplify (for your sanity and mine). Here are the 4 (or 5?) main things we freedom fighters need to focus on:



Pic Credit to: http://torrlaw.com

0. Get out of debt (this is #0 because if you don't have debt, you can skip this step, weeeee!)
1. Create money (active income)
2. Save money
3. Protect money
4. Invest money (to create passive income or more active income)




So all in all, there are 4 (or 5) steps! Now that's not so overwhelming, right?

Welcome (Financial) Freedom Fighters!

Welcome, co- Freedom Fighters!

This is my very first blog entry and I am VERY EXCITED to be starting this!

The WHY:

I want a comfortable life. I want to be able to buy things when I want to buy them. I want to be able to do things which I had been putting off for some time now (Baking school, full time mama schedule, research on a business I want to put up someday). I want to spend my time doing whatever catches my fancy (spend a day reading, why not? or sleeping? or eating?). And I know that to do this, I need to be financially free.

And so, ever since I started working (a loooooong time ago, over 15 years!!!), I had always been curious about how I can make it big in this world! And I have picked up bits and pieces of tools along the way. And this blog is where I want to park them -- so that maybe, I can motivate not only myself, but YOU, who had luckily (thank the stars!!) stumbled upon this blog! :)

The HOW:

What I envision for this blog to be is:

1. A place where I can share what I learned from the stuff I've read.
2. Where I can put in references of other blogs/websites I think have aided me/will aid me in becoming financially free.
3. Where I can celebrate my financial wins (big and small) to keep me motivated and to inspire you.

The WHEN:

I will write whenever possible. :) I hope I can often, but no promises here!! I am still answerable to a boss who determines how much "cheese" this gorgeous rat (I'm still in the rat race, see) gets.

So yes, I have started on this journey, but have taken only some baby steps so far, so you can definitely catch up!!! And maybe even run past me!

So get your running shoes on, let's do some stretches and be in position. So are we ready?! Get set! Let's GO!!!

To freedom!!!!!