7 steps plan to financial freedom

I’m so excited to share these 7 steps with you. Right now I’m at step 5.
My journey towards financial freedom follows these and I document the entire journey. Become inspired and start your own journey 🙂

Step 1 - Small emergency fund


emergency fund

First, you must be prepared for the worst. If you pay off debt or invest, you still need to establish a smaller emergency fund as anything can happen at any time.

It is too uncertain and unsafe to live on the edge.

To begin with I will suggest that you save 1000 USD/EUR in your bank account.

This shouldn’t take more than 1-2 months to save.

Also, use this opportunity to make a budget, find out how you can save more money and read the blog posts I recommend.

Your financial freedom journey starts now! 😊

It took just 1 month to complete this for me.

My main goals in this step:

1000 USD/EUR
Emergency fund
Save +40% of my income on average

Pay off high interest loans


Pay off
high-interest loans

It’s time to remove dirt in your life 😛

Most people agree that expensive consumer loans are a bad thing to have and must be paid off as quickly as possible.

Loans with a high-interest rate take money away from you and make it even harder for you to become financially independent.

If you have any credit card debt or consumer loans they usually have a high-interest rate.


I think everything above 7.5% APROpens in a new tab. is too high interest and needs to be paid off immediately.

It’s not easy to get a much higher return in the long term. So better be safe than sorry.

You can try out negotiating your interest rate if you have a lot of debt and save some money. Simply just ask them.

I never had any high-interest loans so this step was quick and easy for me.

My main goals in this step:

Pay off a high interest loan
(I had none)
Save +40% of my income on average

Great blog posts at this step:

 ★ Setting goals for yourselfOpens in a new tab.

Why is life so hard?Opens in a new tab.

The frugality lifestyleOpens in a new tab.


Step 3 - Strong emergency fund


Strong emergency fund

While investing

This emergency fund will for sure make you sleep well at night 🙂

I have chosen to save money that potentially can cover 6 months of expenses.

This money is not considered as an investment but should be used in emergency cases and is available immediately.

I’m actually a bit lucky because I have an agreement with my bank and my emergency fund has an interest rate of 3%. In most cases, you will not get any interest but maybe you can figure out something.

Start investing…

I think it’s also important that you get started with investing. It will give you motivation, valuable experience, and a potentially great return in the long term.

My first investment was in some stocks and I knew very little at the time. I just wanted to get started and learn. You can start out slowly.

Here are some suggestions
you can look into:

Index fundsOpens in a new tab.

P2P lendingOpens in a new tab.

Real estate crowdfundingOpens in a new tab.

Out of your monthly savings rate, approximately 60% should go to your emergency fund and 40% should be invested in my opinion. 

In this way, you will have a little more focus on minimizing risk and create a financial foundation. It will help you reach financial freedom.

You also need to focus on saving. For most people, it’s very difficult. However, you should aim for at least 50% of your income goes into this plan.

I didn’t achieve the 50% savings rate, but it’s also in focus in the next step. It was more likely at 40%.
I was in step 3 for 1 year and 2 months.

My main financial freedom goals in this step:

6 months emergency fund​


  • January: Started the goal
  • February:  4,54% (+4,54%
  • March: 9,09% (+4,55%
  • April: 14,77% (+5,68%) 
  • May: 11,36% (3,41%
  • June: 18,18% (+6,82%) 
  • July: 27,27% (+9,09%
  • August: 29,54% (+2,27%
  • September: 32,38% (+2,84%) 
  • October: 48,29% (+15,91%)
  • November: 57,38% (+9,09%
  • December: 64,28% (+6,90%)


  • January: 76,70% (+12,42%
  • February: 100% (+23,30%)
Save +50% of my income on average

Pay off loans


Pay off any other loans

While investing

It is time for you to only have your mortgage or rent 😀

In this step, you continue to pay off all the loans while investing.

I had a car, student – and leverage loan. They were paid in this step.

Out of your monthly savings rate, approximately 60% should go to your loans and 40% should be invested in my opinion.

In this way, you will have a little more focus on minimizing risk.

After you completed this step you should add separate savings into your budget.

Now all major purchases (new car, wedding, travel, etc.) will be paid in cash in the future.

Do you promise me that? 😊

This step was completed in October 2020.

My main goals in this step:

Pay off my car loan

I have chosen to go back to Step 4 (February 2020).

The reason is that I have taken a car loan which I will pay off within 1 year. 

Update: It’s paid off in October 2020

This loan will not increase my monthly expenses. The car expenses (the loan and gasoline) are actually the same as a train card.

Why did I choose to establish a car loan?

Once I have paid off this car loan, my monthly transportation expenses will be reduced by about 50-60%. This means my savings rate will increase significantly after it’s paid off.
It will also give us more opportunities and greater quality of life.

  • 8 years loan agreement (2028)
  • 5,14% (APR) annual fixed interest rate

Monthly payment of income in % / Remaining payment in %


  • June: 5,09% / 96,81%
  • July: 5,09% / 95,74%
  • August: 4,82% / 94,58%
  • September: 5,00% / 94,00%
  • October: Paid off
Pay off my student loan

It’s paid off !! @ June 2019

My goal was to pay off this loan 3,5 years earlier. Before summer 2019. The annual interest rate is great but I feel that the loan has been in my life for too long.

  • 8 years loan agreement (2022)
  • 1% (APR) annual fixed interest rate

Monthly payment of income in % / Remaining payment in %


  • January: 4,53% / 82,81%
  • February:  0,00% / 82,81%
  • March: 4,40% / 79,87%
  • April: 0,00% / 79,87%
  • May: 3,99% / 76,92%
  • June: 0,00% / 76,92%
  • July: 4,54% / 73,99%
  • August: 0,00% / 73,99%
  • September: 5,13% / 71,06%
  • October: 0,00% / 71,06%
  • November: 3,91% / 68,13%
  • December: 0,00% / 68,13%


  • January: 4,24% / 65,20%
  • February: 1,96% / 62,72%
  • March: 4,37% / 59,79%
  • April: 14,88% / 44,88%
  • May: 3,85% / 41,95%
  • June: (Used opportunity money) / 00,00% 😎
Pay off my leverage loan

It’s paid off !! @ October 2019

I paid it off after 1 year and 10 months 😎 

I used my opportunity money and 36% of my income in October 2019 to pay it off. I had a great desire to pay off this even though I made money on this leverage loan.

  • 3 years loan agreement (2021)
  • 7,45% (APR) variable annual interest rate
  • Invested mostly in P2P LendingOpens in a new tab.

Monthly payment of income in % / Remaning payment in %


  • January:  0,00% / 100,00%
  • February:  0,00% / 100,00%
  • March: 11,91% / 98,35%
  • April: 11,63% / 95,25%
  • May: 10,49% / 92,15%
  • June: 12,48% / 90,72%
  • July: 11,94% / 87,62%
  • August: 11,60% / 84,52%
  • September: 13,51% / 82,97%
  • October: 12,20% / 79,87%
  • November10,30% / 76,77%
  • December: 12,71% / 75,08%


  • January: 11,16% / 71,98%
  • February: 6,06% / 68,88%
  • March: 11,49% / 67,02%
  • April: 7,68% / 63,92%
  • May: 10,14% / 60,80%
  • June: 8,34% / 58,82%
  • July: 10,50% / 55,72%
  • August: 12,64% / 52,63%
  • September: 11,96% / 50,39%
  • October: 36,00% / 00,00%
Save +50% of my income on average


  • June: Started the goal : 89,46% 
  • July: 87,64% (-1,82%
  • August: 85,76% (1,88%
  • September: 85,88% (+0,10%
  • October: 85,44% (-0,42%)
  • November: 84,38% (-1,06%
  • December: 80,18% (-4,20%)


  • January: 77,30% (-2,88%
  • February: 79,84% (+2,54%)
  • March: 84,64% (+5,02%)
  • April: 88,28% (+3,64%)
  • May: 82,44% (-5,84%
  • June: 85,82% (+3,38%)
  • July: 82,16% (-3,66%
  • August: 81,66% (-0,50%
  • September: 80,14% (-1,52%)
  • October: 81,40% (+1,26%)
  • November: 81,52% (+0,12%)
  • December: 82,52% (+1,00%)
  • December: 82,52% (+1,00%)


  • January: 100% (+17,48%)

Great blog posts at this step:

 ★ Increase savings rateOpens in a new tab.

 ★ Inspiring financial independence quotesOpens in a new tab.


Step 5 - Pay off the mortgage


Pay off the mortgage

While investing

This step will take some time to complete.

However, I don’t recommend that you pay off the mortgage too fast at the moment. Interest rates are incredibly low.

I recommend that you are able to pay off your mortgage within 10-15 years.

I plan to pay my mortgage within 5-7 years. Yes, it’s crazy fast! ⚔️😊

Furthermore, I suggest you really focus on increasing the savings rate. You have already established good savings habits in the other steps but you need to find ways to save more and also to earn more at the same time. 

Out of your monthly savings rate, approximately 30% should go to your mortgage and 70% should be invested in my opinion.  

In this way, you will have more focus on creating wealth and benefit from compound interest.

This is my current step 😎

I will also have short term goalsOpens in a new tab. at the same time.

My main financial freedom goals in this step:

Pay off the mortgage
  • 30 years loan agreement (2046)
  • 3,3% (APR) variable interest rate

Remaining payment in %

  • Not started the goal yet.
Save +70% of my income on average

Step 6 - Debt free


Be totally
debt free

While investing

This step is a dream for many (including myself) because it’s a huge step to become totally debt free.

You are getting closer to financial freedom!

I’m pretty sure this will give me a great feeling of control.

The stress about moneyOpens in a new tab. will be gone and everything is about to fall into place.

Now you can invest 100% of your monthly savings rate.

I can’t wait for this level and every skill I have learned at this time 🙂

I expect this step to be completed within  2027.
I will also have short term goals at the same time.

My main goals in this step:

Save +70% of my income on average

Great blog posts at this step:

 ★ Early Retirement Extreme StoriesOpens in a new tab.

Step 7 - Be financially independent

financial freedom
financial freedom


Be 100% financially independent​

Financial freedom is my reality!!!

It’s unreal right now but maybe it becomes more realistic when I approach this goal.

I have a good feeling about this day! 😎

Remember a dream without a plan is just a wish.


My financial freedom vision

I will wake up in the morning and drink my morning coffee, while I can hear the waves of the ocean.

Then I will swim in the ocean, stretch my body and breathe deeply.

I will train my inner voice and be thankful for everything I love.

Afterward, I will set goals for my day to make progress and follow up on my investments and projects.

I will use what I have learned and is the best version of myself.

My focus will be on eating and live healthily and take care of my family.

Finally, I will write down new value knowledge in my journal in the evening to take action the next day.

I’m financially free and 100% independent.

My life is in balance and I’m in control over my own life 😍

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Financial freedom is possible!

“Your dream can come true if you set the right goals and train your inner voice to execute the steps”