There are a few easy steps that will help you to stay financially independent and explore to grow more. Six Steps for Financially independent Life: # 1. Purchase the house or Rent it When you are young, everyone says that they will purchase the house. Do you think we should purchase a house at an early age? So, let’s see this with numbers - Suppose, you purchase a house, then: Purchase Price - Rs. 1 crore Money from your pocket -Rs. 20 Lacs Loan from bank - Rs. 80 Lacs Bank EMI  - Rs. 72, 000/month for 240 months On the other hand, if you rent the house, then: Rent of house - Rs. 15,000- 20,000 Will save EMI - Rs. 72,000/month Monthly saving – Rs. 50,000 -52,000 If you save Rs. 50,000 -52,000 for 240 months, then you are able to earn a profit of approx. 1.25 crores. Today, people keep on changing jobs and work in different companies and after sometime, start their own business, so, there are many shifts in the phases. At a young age, if you will purchase a house, you will stuck and will not be able to take a decision. Example: A person living in Noida when goes to work in Gurgaon wastes 6 hours in commutation, 3 hours each side. In these 6 hours, a person can do many things. So, if he is on rent, then he can shift immediately and save his commutation time. Thus, you can adjust your lifestyle as per your needs and requirements, if you rent the house instead of purchasing it. When you purchase a house at a young age, then both your capital and time will become a stress for you. It’s better to explore at this age and purchase the house later. Make your first priority to live near your working place rather than purchasing a house. # 2 Shared Economy Taking the example of Ola and Uber, they have changed entirely the experience of taxi services. Previously catching a taxi, cab, and auto was very difficult. You use to wave them and call them but they didn’t listen to, misbehave with you, and charge higher prices. All these things vanished by Uber and Ola services. In India, today, if you take the cost of Car ownership, it includes EMI, insurance, maintenance, depreciation, and driver (ola/uber has a driver) cost. If your car didn’t even move from the garage, then also the cost will come to Rs. 40,000 -50,000 plus an additional petrol cost once the car is out from the garage. Thus, in today’s economy, it is not a compulsion to keep the car instead you can use public transport and utilise the benefit of the shared economy. Don’t take any depreciating vehicle because here you take things on credit and its value also keeps on decreasing. # 3 Power of Refurbished If you want to purchase a car, then you can purchase a used car at half price. Example: 1. Second-hand car If you purchase a 4-5-year-old Honda city, which is running perfectly, then that same car of Rs. 12 Lacs will cost you only Rs. 6Lacs. If your budget is Rs. 12 Lacs, then you may purchase an Rs. 25 Lacs car in Rs. 12 Lacs. Therefore, in the second-hand car, you get at depreciated value. This is why Cars24 has become very popular as people get cars at a lower price from them. 2. Refurbished laptop A good and new laptop normally comes at a cost of Rs. 40,000 -50,000. Go online and check for refurbished laptops. Normally, online, you can get a refurbished laptop at a cost of Rs. 12,000-15,000 whose original cost is Rs. 40,000-50,000. There is a lot of savings, and you get the almost same thing at low cost. You have to see how you can reduce your cost by refurbishing. # 4 Power of Compounding Let’s understand this with the help of SIP (Systematic Investment Plan). SIP means investment done systematically. No one can time and predict the market accurately. Example: Investment = Rs. 20000/month for 20 years Total Investment for 20 years = Rs. 38 Lacs If this money increases by 12% only and the stock index in our country is increasing by 18-20%, then after 20 years, the above money will be Rs. 2 crores. This is called the power of compounding. So, you can plan your life properly through SIP and grow your money. Get the benefit and enjoy the power and money both. # 5 Never Borrow to Consume In the US, everyone moves on credit card and loans. They purchase things today from their future income, which they have yet not received. This is fine in the US because the interest rate in the US is 2-3% and in India interest rate is 16-18%. You borrow at 16-18% and consume it. No use from it. So, don’t borrow for consumption, consume from your own money without borrowing. If you are borrowing, then try that you benefit more out of borrowing, Example:  If you borrow Rs 100 and you have to pay interest of Rs.10, then your investment should be such that you get more than the interest you have to pay from the investment done. # 6 Learn the skill Learn any skill in your life and then you can start the business of it.  Example:  If you think you can learn digital marketing,  then learn it, start the business of it and provide your services. You can learn technology, investment planning, finance, and anything of your interest. Today, people want content and learning, so, take benefit of it and learn new skills and teach that skill to others.