Are there shortcuts to becoming financially independent?
Keytrade Bank
keytradebank.be
November 20, 2024
3 minutes to read
What if we said that the path to financial independence really exists? And that it doesn't have to take as long as you might think? We'll show you the options you have available to take that first small, but important step.
What is financial independence, exactly?
The goal is rather simple: the faster you can get on your own two feet financially, the better. You may have just got your first job, or you've been working for a few years and built up some savings, but you're still looking for that extra boost to take the next big step.
The way to get there is fairly straightforward to explain – the more you can set aside each month, the faster you'll reach your goal.
In other words, you should find a way to stop relying solely on your monthly salary, supplemented with a bonus or the thirteenth month's pay every now and then. The fastest way to success is to generate as much passive income as possible. Examples include:
- Dividends
- Interest
- Rental income
- And many more...
Financially independent does not mean wealthy
Financial independence means that you've built up enough assets over time to be able to finance your lifestyle (almost in full) without an active income. At the same time, you want to build up as much as you can in savings in the shortest possible time.
If you think that sounds unrealistic, you'd be wrong. Becoming financially independent is not the same as trying to become wealthy. Your goal is to be as comfortable as possible from a financial perspective. This means:
- No more worrying about monthly bills
- Preferring not to borrow too much
- Maintaining the freedom to travel when and where you want
- Creating the luxury of choosing a career based purely on enjoyment, not necessity
- And much more...
This means you want to buy yourself freedom both in the near and distant future. But what's the best way to go about it?
Step 1: Know your expenses
Every big adventure starts with a small step. Financial freedom starts with learning how to save and budget. And that starts by understanding your income and expenses. If we're being honest now, do you know what you currently spend each month?
- Map out your annual income and expenses as accurately as possible. Also include unplanned expenses such as repair costs, fines and so on.
- Analyse your monthly expenses. Which costs can you eliminate or reduce?
Step 2: Choose your approach
Work towards your own 'freedom fund' – a fixed amount (or more) that you try to set aside each month. Before you can add anything extra on top, you need to decide which financial horses you're going to bet on.
- Will you decide to put part of your salary into a savings account on a regular basis?
- Do you want to invest your current savings (in real estate, companies and so on)?
- Are you considering investing in the hope of seeing your passive income grow exponentially? If so, do you opt for shares, trackers, funds, government bonds and so on?
In each scenario, you're choosing to get a better return on your money. Yet there's a huge different in the potential return and the speed at which you may generate passive income.
As an example, renting out an energy-efficient home in a popular neighbourhood or investing in a promising start-up can give you a huge boost on the way to financial independence. On the other hand, the financial risks are greater and it requires greater follow-up on your end. Either way, there's no such thing as easy money. Unless you win the lottery, of course.
Step 3: Learn and adapt
Look at what works and what doesn't, and make regular adjustments. Seek advice from people with expert knowledge of the subject. Sometimes, it's also worth showing a little more patience, which can certainly be the case with investing.
Discover the three investment options at Keytrade Bank
Already thinking about more than just saving? At Keytrade Bank, we offer a range of investment options both for those who prefer to play it safe to start with and for those who like to take a calculated risk (you can read more about these investment risks here). Our three investment plans are as follows:
- Keyplan: Invest automatically through a diversified plan with limited risk (from €25 per month)
- Keyprivate: Let our experts manage your assets (from €15,000)
- Trading: You take control and invest in a range of shares, ETFs and funds, guided by our investment tools.
A few other helpful tips
The path to financial freedom is one of relaxation and peace of mind. Be sure to bear the following tips in mind:
- Keep it light: Save where you can, but maintain a sense of fun. In other words, make sure you can still enjoy life to the full.
- Keep it healthy: Don't push yourself too far; rather, move slowly in the right direction. Every additional euro in your pocket is one euro earned.
- Maintain a buffer: A separate savings account is always welcome in the event of unexpected costs such as medical costs, repairs or renovations.
Becoming financially independent isn't a pipe dream
With the right combination of saving, budgeting and investing, you can plot your own path to financial freedom. You're always welcome to contact Keytrade Bank to find out more about our range of saving and investment options, too. Start your journey with us today.
Other articles that might interest you
What monthly pension savings for a maximum return?
Monthly video 2024
What type of investor are you? Take the quiz
Did you just purchase shares? Why you should immediately set a stop-loss
How can you teach your child to save? 12 tips
Why a child deserves pocket money
Pension savings returns: these choices give the maximum payout
FIRE: how hot is this financial trend and how does it work?
Do you have a dormant account? This is how you can check!
A potential worldwide trade war is claiming European victims
Start growing your pension sooner rather than later
Ever thought of investing in the pet industry?
Have long-term interest rates once again started a 40-year uptrend?
Democrats or Republicans: which party is better for your investments?
Guide: how much you need in savings
Graph of the Week: Magnificent 7 vs 2000s Tech Bubble
Actively managed ETFs: the best of both worlds?
Investing at new highs is an elevated idea
5 mistakes investors make in volatile markets
What if you are unable to pay the inheritance tax?
Government bonds, savings accounts, or term accounts: which should you choose?
6 reasons to invest in food
Checklist: travel without any money worries
Take a moment to read this before sharing your data
Investing in Belgian shares: the dangers of too many domestic securities
Investors, never pay too much for your favourite share!
Buying real estate together? Consider a rights of survivorship clause
What your friends forgot to tell you about cheaper travel
Investing in football shares: what's the score?
Basic interest rate and loyalty bonus: what does your savings behaviour say about you?
Helping your (grand)children to buy a home: what are the options?
Why high dividend yields can be a poisoned chalice
12 questions and answers about a lasting power of attorney
Comparing savings accounts: where do you put your money?
3 ways to invest when you don't have much time.
Is it time to invest in Chinese stocks again?
Europe is no longer falling behind!
How do you select an investment fund for your child?
Secure online banking: how can you protect your finances?
How can I invest or save better for my child?
Opening an online bank account: what is holding you back?
The difference between distribution and accumulation for funds or trackers
Will ultra-low interest rates make a comeback? Probably not…
Why pension planning is even more important for women
Why the S&P 500 does and does not have a problem
Robotics: From science fiction to science
Property shares: ripe for a comeback?
Are money market funds an attractive investment?
Is joining the BEL20 actually good for you?
Is it the right time to invest in bonds?
Stock market records: some down-to-earth advice on how to respond to dazzling heights
Have you ever thought about investing for your children?
Borrowing for a second home: what are your options?
Can we still say "Magnificent Seven"? Or should it be "2 Unlimited "?
How can you invest in space travel?
Invest yourself or have someone do it for you: do you have to choose?
How much can you borrow for a home?
What do you have to tell the tax man about your money and investments?
Monthly video 2023
Five myths about sustainable investing
How can you invest in an ageing population?
Small company shares with big opportunities?
6 reasons why installing solar panels is still worthwhile in 2024
How do elections affect the stock market?
8 questions and answers about holding companies
Golden days? Why to invest in gold (or not)
Is a buy-to-let property a smart investment?
Nigeria: a new hot spot for adventurous investors?
Exemption from withholding tax on dividends
Will bonds beat shares in 2024?
Investing in emerging markets: are investment funds a smarter buy than trackers?
Passive investing: less effort for a better return
Don't forget to create an extra access!
Shorting: what is it and how does it work?
The 10 principles of stock market success
The advantages and disadvantages of contactless payment
How to invest in the energy transition?
Keytrade Bank has one of the few free credit cards on the Belgian market
How to put phishers out of a job
Which sectors should remain overweight following the latest rate hike?
8 timeless rules for investors
Investors are not afraid of risks! Or not yet?
Get ready for the last quarter!
Investing in biodiversity: can Wall Street save the rainforest?
Investing in AI: hype or a ticket to the future?
Saving for the sake of saving? Or with a goal in mind?
How do you prepare financially for a longer life?
Handling recessions: a manual
How to navigate a relationship with lopsided incomes?
Avoiding and dealing with conflicts on financial matters: a guide
Sell in May? Is it really such a good idea?
1 account for the both of you? Or separate accounts? Or a combo?
Make an impact with your Keyprivate
How much diversification is enough for your portfolio?
From KIID to KID: new rules, better investment decisions
Which investment opportunities are available on the road to smart mobility?
Is the end nigh for American dominance?
A vitamin shot for your investments
Does water earn a place in your portfolio?
What is the difference between a tracker and a fund?
Bonds to rise in 2023?
6 things you need to know about your Keytrade Bank credit card
Monthly video 2022
What is technical analysis and how does it work?
How to buy real estate with your supplementary pension (even though you have not retired yet)
Less costs? Yes, please.
The situation following the Russian invasion of Ukraine
There's something new in the air in the investment world!
6 points to consider for thematic investing
Belgian traders tempted by American stock market rush and Reddit investors
Getting nervous about the stock market? Take a look at the 200-day moving average
How do you find out what a company’s ESG rating is?
ESG's alphabet
With or without the coronavirus: why green investing remains just as relevant as before
Impact investing: sustainable investments with that little bit more
Sustainable investing: what, why and how?
How can you make an investment portfolio inflation-resistant?
All in our fund market at the same price
How to invest if you're on a tight budget
No extra costs ...
CARD STOP has a new number! 078 170 170
This is what the tax authorities know about your money
Investing in dividend shares: what to look for?
10 ways to save money with apps
Monthly video 2021
Podcasts about money and investments (part one)
No group insurance plan? What are the alternatives?
Les plafonds fiscaux pour les années de revenus de 2020 à 2023
Which investment style and which regions would benefit from renewed growth in interest rates?
Inflation? Grab some commodities for your portfolio!
Which shares will be the rising stars once interest rates start increasing again?
10 things you can do within a day to improve your financial health
Enjoy your stay at the hotel and pay less
How to choose a tracker (ETF)
Gold, cash and government bonds: how safe are safe havens?
Cohousing rules
The halo effect: why we are buying the shares of Buffett, Bezos and Musk
Why investing for your child is a good idea
Timing is everything: how to choose the right time to enter the stock exchange?
La technologie préserve les investisseurs contre l'utopie
What is fundamental analysis, and how does it work?
How to protect your hard-earned money from hackers
Why (not) invest in micro-caps?
Rising debt: is it a problem?
How safe are contactless payments?
Funds and trackers: do you opt for capitalisation or distribution?
What do I do to balance my investments?
CARD STOP has a new number! 078 170 170
The treacherous stock market
On the way to a society without cash?
Buying a second residence: with savings, investments or a loan?
A must read for when you spotted a second-hand bargain online
Always have a megatrend in your portfolio
Maths on the stock market
The impact of luck on investments
The handiest financial apps (and free as well)
Are you investing really globally with a tracker on a world index?
Equity investors look beyond gloomy economic data
7 investment themes for 2029 (for which you can get a head start already)
Ten basic rules for lifelong success on the stock market
Share everything with peace of mind. Except your bank cards.
Any dip in the global economy appears to just a passing blip!
Are we heading into a year-end rally by the stock markets?
Coronablog de Geert Van Herck: La panique atteint des sommets… énième épisode
Seven investment myths
Age catching up with you? It's never too soon to think about your retirement
Blended family: shared savings account or keep things separate?
Emerging countries are lagging behind!
First Aid for Your (Financial) Administration
Tips from an expert: how to keep your passwords safe
Coronavirus blog Geert Van Herck: Property once again fails to deliver diversification bonus
Coronavirus blog by Geert Van Herck: S&P 500 indicates a positive trend
What retirement pension will you get later?
How can we cope with financial stress?
Saving your payment card details in your browser: yay or nay?
No extra costs. Yet 700,000 euros gladly given to you, our customers!
Can China make the dollar crash?
US stock market dominance not coming to an end yet!
Are trackers the latest bubble on the financial markets?
Podcasts about money and investments (part two)
Anxious about inflation? Have you ever considered the mining sector?
Will the MSCI Emerging Markets index become the next big thing?
What does higher inflation do to your savings and investments?
Going for gold? Gold is apparently going for it.
How can you invest successfully?
Which shares suit you?