Financial Freedom is a hot topic at the moment with every finance blogger tweeting about it daily. LOL. What is financial freedom though and what does it means in practical terms for us “ordinary” folk?
This is my definition:
Financial Freedom is when you have enough money to live without needing to actively work each day. There will always be some level of work in order to manage your finances and investments, but you don’t need to work in a “normal” job in order to survive.
Brendan – Take Charge of Your Money
What does financial freedom mean to you?
It’s important to remember that financial freedom means different things to different people. And it’s okay to come up with your own definition.
To some it means never working a day in their lives again.
To others it means having enough to live comfortable without the need to work. But what’s comfortable to one person may not be very attractive to another.
Some may simply want to own a small property and live off the land. Family, close relationships and time are of immense value.
And for others having enough money to travel the world in luxury is what they’re after.
There really is no “one size fits all” definition.
You should think about your life and decide what what financial freedom really means to you. That can be used as a start of your plan to eventually make it happen.
How long can you survive without your current income?
Did you read the post on a new way to measure your wealth?
This post shares how you should work out how many months you can survive without your current income. You can use this as a scale to determine what you mean by financial freedom. Yo may feel that you’re financially secure if you have 5 years worth of living expenses at you disposal. Or possibly less.
It’s just a new way of looking at your wealth and understanding how “free” you really are.
As you can imagine, debt plays a huge role in this. Here’s a short post on how to start unwinding the debt spiral.
Time for money
Have you ever considered how we spend most of our lives exchanging our time for money? And then we forever berate the fact that we don’t have enough time.
Time is our most valuable asset in life and financial freedom is your ability to buy back your time.
