Whether you’re aiming to retire at 65 or dream of being mortgage-free decades earlier, achieving financial freedom is possible with careful planning. By taking the right steps now, you can set yourself up for long-term success and independence. 

Financial freedom means different things to different people—being debt-free, paying off a mortgage, living off investments, or a combination of all three. No matter your goal, the time you spend planning will be the most valuable part of the process. 

Define your goals

Start by figuring out exactly what financial freedom looks like for you. Do you want to: 

• Pay off credit card debt? 

• Eliminate your mortgage? 

• Build enough wealth to retire early? 

Paying off debt may be simpler and faster, while creating a long-term income stream for life will require more methodical planning and ongoing adjustments. Knowing your goals will help you outline the steps needed to achieve them. 

Tackle debt first

If paying down debt is your priority, it’s important to have a clear plan. Calculate how much you need to pay each month to eliminate your debt within a set timeframe. 

• Chip away monthly: Make regular payments or set aside extra money in a high-yield savings account to pay off debt in one lump sum. 

• Consolidate debt: Combine high-interest debts into one lower-interest loan to reduce payments and pay off debt faster. Just be sure to check for early repayment penalties on your current loans before consolidating. 

With interest rates currently low, paying off debt often makes more sense than saving. However, when rates rise, it’s smart to reassess and see if saving offers a better return. The key is to ensure any savings account earns more interest than you’re paying on your debt. 

Build a lump sum

If your goal is to pay off a large balance in the future, such as a mortgage or student loan, start working on accumulating a lump sum now. Many mortgages allow you to pay up to 10% of the total balance annually without penalty, which can help you chip away at the principal faster. 

A helpful strategy to grow your savings is to use the Rule of 72. 

This simple formula can estimate how long it will take to double your money. Just divide 72 by your expected annual return. 

• Example: If your goal is to double your money in 25 years, divide 72 by 25. You’ll need a return of 2.88%. 

• Want to reach your goal in 15 years? A return of 4.8% will get you there. 

While the Rule of 72 is just a guideline, it’s a great way to estimate how your investments can grow over time. 

Plan for the long term 

Regardless of when you want to retire, starting your financial planning early makes a huge difference. The earlier you invest, the more your money can grow thanks to compound interest. 

Albert Einstein called compounding the “eighth wonder of the world” for a reason. The longer you leave your money invested, the greater the returns will be. Even small investments made early can grow larger than larger amounts invested later. 

Start today!

The key to financial freedom is starting now. Whether you want to pay off debt, save for retirement, or eliminate your mortgage, early planning gives you the best chance at success. 

Take control of your finances, set realistic goals, and begin building toward the future you envision. Your journey to financial freedom starts today.