Being financially independent is something many people really want to achieve, unfortunately, many think they have to be very rich to achieve this goal.

See, you don't need to make so much money or become a Dangote before you can become financially independent.

All you need is to understand how to manage your money. No academic degree is required to do this. Here are five crucial steps you need to take to become financially independent.

1. Spend less

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Spending less than you make helps you to have enough money to save. And guess what, you can use the saving to meet some pressing needs or use it to invest.

2. Reduce your expenses

One of the biggest challenges people face in personal finance is understanding how to cut down on their expenses. By being frugal about your spending, you become more cautious about how your money is spent. This allows you to save and spend your money only on needs rather than wants.

3. Create and stick to your budget

You need to put up the best of your financial habit to clear your debt.

Creating a budget would help you control your spending and curb your excess spending. But to make your budget work, you need to stick and follow through with your budget.

You can have a budget but you might not be able to follow through which means you’ll spend more than you are supposed to.


4. Avoid debt

Preventing yourself from overspending is one way to to stop worrying about your finances

Avoiding debt in all its forms is one of the best ways to avoid financial anxiety because debt is a potential source of financial worry.  It can prevent you from attaining your personal financial goals.

So instead of borrowing, just avoid any expenses that may require you to borrow money. If you stick to your budget and save enough, you'll purchase your dream car or house without taking loans or borrowing.

5.  Build an emergency fund

An emergency fund may not seem like it belongs in a list about how to spend less than you earn, but it does.

An emergency fund allows you to take care of unexpected expenses so you don’t spend more than you earn by blowing your savings.