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Having an efficient financial plan is the key to monetary freedom.

A good financial plan will let you quit your day job and stay home with your family when it consists of the right elements. Wealthy individuals who create financial layouts are careful to put all the right ingredients into it so they can live the life they choose. Anyone can do the same. It is about creating the vision you want for yourself and if you truly want it, it can be a reality. This is how.

Multiple Income Streams

Having more than one income stream is helpful when a person wants to leave their day job. Earned income is what most people are most familiar with. However, if you want money to work for you instead of you working for it, then you must create passive or portfolio income as well. The more income sources you have, the better off you'll be.

Passive income

Passive income is generated through real estate in the form of rent. If a person purchases a house and rents it out to tenants, they will receive payment on a monthly basis. They would create residual or passive income this way.

Internet Revenue

This is a form of passive income as well. When a person has a website and receives compensation from Internet advertisements.

Royalties

This can be received when a person publishes a book or sells music. The amount of the royalties is contingent on how many books or music is sold. Many people write books and live off the income alone.

Portfolio income

A portfolio is a collection of investments. Most wealthy individuals have a diversified portfolio which consists of various types of assets. Their portfolio earns money for them. They may have a mixture of various stocks and bonds. These investments earn interest daily.

Adequate Liquid Savings

A good financial plan will have sufficient savings. You never know what can happen so it is good to have a safety net available just in case. This savings account should be able to earn high interest as well.

An Emergency Fund

Besides having a savings account with enough money in it, a good financial plan will include a one year emergency fund. This is different from a liquid savings account because it can only be accessed for emergencies only. An emergency would be the loss of a job or home.

If your financial plan has these elements, you will be on your way to living the life you always dreamed of living. Put your money to work for you and you will have more time to spend with the people you love most.

Learn more about this author, Angela Diggs.
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