3. Save 10% of your income each month.

If you are successful in cutting your living expenses by 10%, you should plan to direct that money into savings. The purpose of cutting expenses is not to go on a financial diet, but to free up capital for future growth and financial independence.

You can start out directing the extra money into a savings account, and then eventually move into mutual funds, or an investment brokerage account where you can diversify into many different assets.

Cuts in your living expenses may not feel good, but the growth in your savings and investments will more than offset that.
 
 

 

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