I’ve heard the phrase “financial freedom” several times in the previous 3-4 years from the investors community.
Every time I speak with a customer or an investor on various forums, it appears that “financial independence” has become the new catchphrase. So I decided to talk about it more today.
What is Financial Freedom?
Simply said, Financial Freedom is the accumulation of sufficient wealth to cover your living expenditures for the rest of your life. You’ve saved enough money to cover all of your bills for the rest of your life. After that, you won’t have to worry about money.
How much money makes a person financially free is a deep question and there can be debate on this topic alone, but in the most simplest form, once a person acquires 35-40 times their yearly expenses requirement, they are said to be financially free. You can read more on this 30X rule for retirement here
Let me get to the point of this article and discuss the top 5 reasons why I believe most individuals should strive for financial independence early in life by the time they are 45 or 50 years old.
To buy Freedom in Life
We all labour all hours of the day and night to make money. Money covers all of our costs. Rent, food, school fees for your children, and healthcare costs. Everything..
If money is not everything in life, it is certainly a very important factor!!
To bring more power in your career
A lot of people have this myth that one shall achieve financial freedom, so that they can quit their job and retire from work.
More flexibility to pursue other passions
Financial Freedom also gives you freedom to pursue any long due passion which you were not able to fulfil while in the regular job.
Reduced stress and worry about money
This is a no brainer.
Ask the question to yourself right now. If you loose your job and are never getting another one again, how many years worth of expenses do you currently have?
