Many think financial freedom is something that cannot be achieved. This belief is so deep the whole concept of being financially free simply feels like an illusion. Most have totally given up on the idea and the phrase ‘financial freedom’ is not even in their vocabulary! Achieving financial freedom by following three simple rules will put you on the road to financial stability.

Rule Number 1: Never Live Above Your Means

Living above your means is one of the main reasons many never realize financial stability. Living above your means indicates you are spending more than you are earning. In the long run, you could end up dead broke; no savings and you are most likely living paycheck to paycheck. Try and live below your means. Look at what you are spending money on. Some of life’s luxuries you are indulging in can probably be eliminated. Look closely at what you are spending money on and figure out what you can get rid of yet still live comfortably. For example, are you using Uber, other ride-share apps or taxicabs excessively? Perhaps you can look at public transportation or carpool options. Have you considered walking or even biking? You could realize significant savings. Creating a budget is the best way to see where your money is going.

Rule Number 2: Save and Invest Whatever Remains

Once you have identified where you can eliminate or greatly reduce spending, take those funds and invest them—no matter the amount! There are various saving options offered by banks, such as interest-bearing accounts. An interest-bearing account, e.g., certificates of deposit (CDs), is one in which the bank pays you interest (money) based on a percentage of your account balance. Take a good look at your banking institution to see if they offer these types of accounts. Saving is one of the wisest things one can do. It is important to think of the future and not just today. Look for a savings arrangement you can live with and start now to grow your money.

Rule Number 3: Continuously Improve on Rules 1 and 2

It is easy for one to plan to save or minimize his or her expenses. The problem is after a few months or so, old habits return. Make sure you don’t fall into this trap. Keep looking at ways to reduce your spending and increase your savings weekly. If you need help, Google search articles or books about money and you can always reach out and talk to a financial professional.

Being healthy is very important and preventing debt stress can be a factor in contributing to good health. Anything you can do to help keep yourself healthy should be your top priority. Exercising and eating nutritional foods, along with possible meditation or other means to help relieve you of daily stresses that may be bogging you down can help make a difference in how you feel. Creating a budget is key to dramatically improving any debt issues to help with stress reduction. A survey by Credit.com revealed nearly 27% of Americans don’t think they need a budget.

Figuring out a budget is something most have difficulty with. The key to achieving debt relief lies in creating and managing a well-balanced budget. Getting into the habit of following a budget first weekly or monthly—your choice—is undoubtedly the best way to improve your debt condition.

Start thinking about how to manage your money properly. You want to be consistent in sticking with a budget—one that is realistic for you. Doing so will drastically pay off for you down the road. You will finally release some of the stress to help you enjoy your life fully, without the worries of feeling overloaded with debt over debt.

Having a budget makes it possible for you to recognize you can do more than just survive month to month. Even better, you will find ways to have a little bit of extra money each and every month! How fabulous would that be? Now is the time to stop feeling overwhelmed and exhausted from thinking about your debt. Carve out some time from your hectic schedule to sit down to work on this. Let’s get you on the road to fixing your debt problems instead of thinking it will just go away. Take a deep breath and just follow these 3 easy steps to get started! We created an easy to use spreadsheet to get you started. (Here is a PDF version if you don’t have spreadsheet software.)

Step 1 – Make a list of monthly expenses

The first step is to list all of your expenses. There are two types of expenses fixed—stays the same monthly and variable—changes month to month. Fixed expenses include rent, childcare, health insurance and the cable bill; variable expenses can be the grocery bill and the amount you spend on gas for the car. The quickest way to compile your monthly expenses is to look at your debit card or bank statements! Create buckets for your expenses: “Eating Out,” “Rent,” “Travel,” “Clothes Shopping,” etc. Create a 3-month history to get a realistic picture of your spending habits.

Step 2 – Determine your income

Look at what you are paid after taxes. If your income varies weekly, it is fine to average what you are paid on a monthly basis. Be sure to include any other income, e.g., alimony, your side hustle and rental income.

Step 3 – Calculate the difference

Take the total of your monthly expenses, fixed and variable, and subtract this number from your total monthly income. If you have a negative number, this shows your expenses are more than your income. If so, start looking at how you can trim expenses—maybe eat out less? Take public transportation to work instead of driving? Perhaps it is time to ask for that raise at work? Start that side hustle you keep putting off? Keep looking at your expenses to see what can be reduced or even eliminated. Consolidating your bills each month makes it possible to help save money too.

If the difference is positive, congratulations! Is that amount consistent month to month? Once you have the answer, you want to look for ways to make this money work for you. Start out by looking at your budget every 2 weeks until it becomes a habit. Think about automatically diverting that money into an interest-bearing account to avoid the temptation of frivolous spending. Consider buying insurance to make protect your life; to supplement your retirement; or to build up and pass on wealth to your loved ones.

Don’t let debt become your worst enemy. Eliminate this area of stress in your life by following these 3 easy steps to building a budget. Teach your young ones at an early age the value of money by teaching them how to follow a budget.