Level of Financial Independence

downtoearthinvestor.co.uk

Financial independence of each person will vary depending on the phase of life. To measure the level of your financial independence, Citibank has had a guide. Only by understanding where your level, it will be easier later in the set or a financial plan to be more financially independent. You certainly do not want to forever trap in credit card debt or not is also able to acquire assets such as houses or cars instead?

According to Citibank, the general level of financial independence is divided into five:

The first level,
you can free yourself from financial temptation. This is the most basic level. If you want to live up to the next level, you should be able to control them financially. The first level is characterized by you no longer have the condition which is termed the large pegs instead of the pole.

The second level
your free financial dependence of the people who love you. That is, you are able to finance them without relying on other people around you, like a parent. Financial independence just as it is highly desirable by the younger generation entering the new world of work and has full responsibility for them independently.

The third level,
you are free of dependence of the creditors. Not a few people who take advantage of financial loans and also would not hurt to borrow money if it is able to manage financial loans without making it as a burden. That is, you can say financially independent at the third level if credit card debt, mortgage, or other personal loans can be resolved or well controlled.

The fourth level,
you are free of dependence on employment as an employee. You are said to be financially independent by becoming a level four businessmen. That is, you have the financial independence by not relying on the monthly salary drawn from the position as an employee of a company.

Fifth level,
at this level is the level of most prime independence, only if you are free from financial problems. You no longer have financial problems or all matters relating to the financial issue has been handled and properly secured. You just need to enjoy life.

If you are still in stage one to three, the sign you need improvement in financial management.

You need to do financial planning for improving financial condition.