blog, money

Financial Freedom

The idea of financial freedom is being able to afford your current lifestyle without actively working for a regular paycheck. Some may look at retirement as an example of being financially free. I personally believe financial freedom is being able to live the life you want without having to stress about money. It is when you no longer have to worry about money coming in or what bills you need to pay. I believe most of us desire to reach a place of financial freedom but the reasoning for this desire is different among each individual. Not everyone desires to stop working especially if they are doing something they love. Let’s take a look at the richest man in the world today, Jeff Bezos. He was and still is very passionate about his company Amazon. Lucky for him, his passion has lead him to extreme wealth where if he handed the company over to someone else he would have no worries about money. In this case, financial freedom is not about retiring but being able to do the things that you are passionate about. It gives you the freedom do what you really want in your life or take risks without worrying about when money will be coming in.

Think of the term starving artist. Imagine living, breathing , creating art or music but not making enough to live on. In this scenario, you would have to get a full time job in an office and live a life that doesn’t make you happy and it will take away your time from dedicating your energy into what really makes you happy. This is why learning how to make your money work for you is important. If you just work this other job for the next 30 years and don’t properly manage your money to allow you to also do what you enjoy then you would have lived an unfulfilled life.

My goal is to reach a place of being financially free which will allow me the option to have the choice to work or not. Since I am working full time for a company, I make sure I invest my money into things that will bring in future passive income that will help me afford my basic necessities. Examples of this can include dividends from stocks, real estate, side gigs, own business etc. I think it is important that you don’t just work for a paycheck , pay bills and “hope to retire” one day. I believe the sooner you begin to put money into things that can make you more money and find ways to generate more streams of income outside of your employment, the more wealth you can accumulate in which you can reach financial freedom sooner than the national retirement age. Life is about balance. Let’s be honest, none of us know how long we will live to so managing your money to enjoy it today and also making sure you have enough for the future is extremely important. I get it, some people have the mindset that they don’t want to wait until they are older,  sick and can’t move around like they do now. That’s why you must capitalize off of the things you are good at and enjoy yourself while also working for someone else if you cannot withstand the risks of solely relying on your talents/passions. Also, let’s be real, not everyone wants to work for themselves or be a boss and that is fine. The idea of financial freedom is to allow yourself to retain as much of the money you make and find ways to grow it so at some point you can do the things you enjoy without worry. If you feel like traveling to another country next month, you will be able to without stressing how to make that happen.

What is your definition of financial freedom?

Create a list of your hobbies, talents and come up with ways you can make money off of them. You can even take personality tests. If you are an extrovert who likes people and good at selling things you can be a sales consultant. If you are an introvert who is good with computers or website designs you can offer those services to make money. There are so many ways to make money. Utilize the resouces you have available such as books and the internet.

“It is not how much money you make, it’s how much money you keep.”—unknown

After finding ways to make more money put that extra income to work so you can generate enough passive income that will allow you to live a financially free existence.

Self help

GOAL SETTING*

People set goals everyday but not everyone ends up following through with making sure they meet these goals. For example, you may ask someone where do they think they will be in 15 years and they will reply “I will be rich and traveling the world”. Now ask that same person how do they plan to get to this point and they are stuck. They do not know how they will do it. Someone who sets goals will be able to tell you what they will do to accomplish this goal whether it’s start their own business, invest a large percentage of their income, avoid unnecessary purchases etc.

 

 

I recommend having a long-term goal set that includes multiple short term goals along the way to assist you with accomplishing this goal.  Setting multiple goals along the way is beneficial because most people like to see quick results. How many people do you know that start a fitness plan but after two weeks because they only lose 2 lbs they give up. This is most of us because we want instant gratification. This is the culture we live in. To avoid giving up, I suggest setting short-term goals that can be met so you can feel like you are making progress towards the long-term goals you have.

 

Let’s say your goal is to save $100,000 in 5 years. If you are not a high earning individual who could save this amount in a lesser timeframe, I recommend breaking it down into saving smaller amounts of money in smaller time blocks. This will allow you to reach $100,000 by the end of that 5-year timeframe. This can entail setting aside a certain amount of money from each pay check you get to put into savings or investments over time to equal your goal.  If you don’t want to set exact numbers you can also create a chart with a list of steps to take to get you where you need to be. Please see chart below:

 

Screen Shot 2018-07-18 at 6.59.09 PM

 

This is just an example of how you can draw out a plan. I would recommend making your chart more in depth and creating a vision board. Place this vision board in an area that you will be forced to look at it every morning. If you see it every morning it will help keep you on the right track. What’s the point of setting goals then giving up on them continuously? Remember to take action , have a plan and work towards reaching each target.

 

“Keep setting short-term goals that will eventually help you meet your long-term goals. “