We all dream of being financially independent. The difference is, some people really get there. It isn’t an impossible idea, or something that you should dismiss just because it seems difficult. Actually, making a few smart choices now could create a future in which financial independence is your reality, not your dream.

Think profit, not income

Many people assume that you can get wealthy simply by having a well-paid job. This is not really the case, and many executives who get there soon realise that they still don’t seem to be amassing money in the bank. The secret is that you have to make more profit – not more income. In other words, the less you spend, the more money you have. Start to live frugally now, and your income will stretch a lot further. That means putting savings in the bank, and ending up with a nice buffer that could allow you to quit your job.

Invest surplus funds

When you start to build up some money in the bank, it’s time to do something with it. You could leave it to amass interest or build up on its own, but that will always be a slow process – no matter how good an interest rate you get. Instead, take your surplus funds and use them to start investing. You can learn to trade even if you have a full-time job, and it doesn’t take much to get started. Then you can build up your small amount of savings into something much bigger. You may have heard the stories of people who invested a tiny amount of money in Bitcoin right at the beginning and are now millionaires: that’s a really dramatic example of how investing can take you to financial independence.

Fund your retirement

Start saving up for your retirement now – and that means really saving. The more you put away into your retirement fund, the more you are going to be able to live on when you retire. If you build it up fast, you may also be able to retire early. Income from a wage faces a steep tax which could decimate your earnings, whereas income from a pension or retirement fund is often not taxed at all. If you can get your retirement payments to work out roughly equal to your salary, you will suddenly become hugely richer just by retiring.

Build your family

One of the most important factors in become financially independent is the family around you. For example, if your spouse is a big spender who likes to splash out on status symbols, you are never going to reach financial independence. If they are willing to live frugally and are thrifty-minded like you, you have a better chance of getting there. The same goes for your children. Raise them to appreciate small gifts, rather than expecting luxuries and the big new gadgets every time they are released. You can even teach them life lessons by having them work in exchange for their pocket money, doing things that will save you time or money because they are taking over. Examples include washing your car by hand, taking care of your yard, cleaning the house, and so on.

When you follow all of these steps together, you will reach financial independence eventually. The question of when is dictated by how hard you work. If you build yourself a strong career by working hard, remain committed to the frugal life, and invest wisely, your financial independence could arrive a lot sooner than you think. If you barely make an effort, you might never make it.