Do you feel like financial independence is impossible? It feels so far away that it is so easy to lose sight of it.
Once you unravel your finances, feelings of insecurity, loneliness, and hopelessness all creep in.
It can take months or even a year to find a financial independence journey you and your family are comfortable with.
But once you’re there, you will be liberated, feel in control, and be unstoppable.
The goals are no longer if you get there but a matter of when you get there.
Here’s how you can achieve financial independence when you have a family.
1. Balance life for now and for life in the future
When saving for the future, families can feel like they are constantly depriving themselves because there is no immediate return.
Discuss your family values with your partner.
Then, make a list of the top 10 things your family values, and look at your budget.
Does your budget reflect your values? If not, then redo your budget.
Identifying your family values will give you a clear vision of where your money should go.
It allows you to enjoy life now and still plan for the future. So identify what you value and spend money on those things.
One of the things we value in life is traveling with our kids. We do 3–4 vacations each year since our first son was born, even while investing for retirement and college.
2. Do well with money on one income
Some families make $100k+ on two incomes. Other families make $100k+ on one income, while others make less than that with just one income.
However, not everyone is organized with money.
Be intentional with the money you have.
Assess the budget to see if whatever is going out is necessary. Do this monthly. Every dollar needs to have a name.
Having control of the money and where it goes will allow you to spend less and save/invest more even on one income.
Once we had children, I became a stay-at-home mom, and our income became $85k instead of $100k +.
We assessed our budget so that we can live for today but also save for the future.
Ultimately, our finances are better with only one income because we became laser-focused on the budget.
Related Post: Ultimate Checklist: How to Live Frugally on One Income
3. Understand the value of things and your time
People spend money impulsively. People do not put enough time into thinking about how much value the item brings to their life or how long it took to earn money to buy it.
Analyze how much things cost and if it brings value to your life.
Does it enhance your life despite the financial impact it may have? How often will you use it?
We spent $1700 on an electric bike that my husband uses to take our kids to local parks around the area. He gets exercise on the bike while spending time with the kids.
4. Talk about money openly with your children
Money conversations are a taboo topic in our society, and consequently, people struggle with everyday money management.
Teaching kids about money means talking to them about how we come to our money decisions.
We need to discuss the thought process behind our decisions and explain it to them.
For example, explain why you can eat out every night or why eating out occurs once a week.
While on vacation, our toddler gets $2/day, and he can spend the money on a juice or a toy, and once it’s gone, it’s gone.
5. Frugal with money but not cheap
There’s a misconception that being frugal is being cheap.
Frugal is being intentional and spending less, while cheap is buying something because it costs less.
When you have to buy something, ask yourself if it brings you value.
Identify the things that matter and the things that don’t.
Big purchases require extensive research. Ensure the quality of the item reflects its worth and that you find value in it.
We buy quality items and pass them down from one child to the other.
Related Post: Life-Changing Ways to Avoid Frugal Fatigue
6. Plan out your family goals
A life without a plan allows life to happen to you.
Make a list of your family goals for next year, five years, ten years, and so on.
Once you know your goals, work backward to see how you can achieve them.
Monthly budget meetings are an excellent time to revisit family goals.
In 5 years, our goal is to retire from the military. We dream about different states to settle down in and know we can end up anywhere, despite the costs, because we are already saving and investing for it.
7. Build your child’s financial future when they are young
Parents intend to give their children a better life than what they had growing up.
Identify if your retirement goals are being met first and determine if you can begin building your child’s financial future.
Different avenues of creating wealth for kids include opening a college fund, a Uniform Transfers to Minors Act (UTMA) account, a brokerage account, or even a Roth IRA.
The benefits of compound interest and time motivate parents to start investments early on.
We opened a 529 account when each child was born with a sizeable lump sum and currently make monthly contributions.
Now what?
It will take a while to find the financial independence journey that works for you, but it will be worth it. You will become motivated and empowered.
Imagine what it is like being a financially independent family. You will no longer feel financial insecurity.
Imagine having a paid-off house or the ability to pay it off with the click of a button.
Imagine having a comfortable retirement and not being a financial burden to your grown children.
We have reached financial freedom, but we are still on the journey to financial independence.
We have a long way to go.
But making these lifestyle changes brings us one step closer to the end goal while maintaining a high quality of life full of value and intention.
Once you do these things I mentioned, you can confidently be on the path to financial independence.
You can maintain a high quality of life and live the life you dreamed of for yourself and your family.
It doesn’t have to be all or nothing.
The best part is, you can have it all now and in the future.
