Financial freedom or financial independence is often described as a place you reach in life where you have more than enough money to live on now and for the rest of your life. The only problem with that definition is – it immediately seems an unattainable goal especially if you are starting over again in life.
How can you make that amount of money? Short of robbing a bank or winning the lottery financial freedom was a pie in the sky dream for me as it for many people.
Over the next weeks I want to share the story of how I discovered the path to financial freedom and the steps that I took to help me on my way.
My Story
My parents were very cautious with money. They were both great savers- squirreling money away for a rainy day.
Then one day the rain came but money couldn’t help. Suddenly my mother died. I was 7. My father was devastated. His biggest regret was never having taken my mother to nice restaurants or on special holidays – we were always saving for the future he said and now it was too late.
That set my view of money. It could not bring my mother back and it made my dad very sad. Money did not bring happiness.
After that money was something that never really interested me. When I had it I spent it. I lived up to my income and sometimes beyond it. For me, that was financial independence. Then something changed.
I decided that I no longer wanted to follow the career path I was on. I wanted a different life. At that point I realised the financial independence I thought I had was totally dependent on my corporate masters. My financial independence was a myth.
Around this time I learned a major lesson about money.
Money can set you free or trap you – if you let it.
I did not want to stay in the job I was in but in financial terms I could not afford to leave. I have seen this dilemma play out for so many clients over the years.
I want to change career
I want to leave my partner
I want to spend more time with my children
I want to retire
I want to take a year out
I want to work less hours
…………………………….But how do I pay the bills?
Here are the first steps to finding the road to financial freedom.
Step 1 – Take responsibility for your financial position
This can be hard because if you have been made redundant for example – you didn’t choose to be in the situation you are in. However you can choose to do something about it.
You can stay where you are, be miserable, moan and wait for the lottery win or you can find a new way forward. For me there just had to be another way because it was too painful to stay doing something that no longer made me happy.
Step 2 – Work out what you do and don’t want to do in your life
This was the most important question that I asked myself. What did I want to achieve in my life? These are some of my answers.
Support my family
Stop working long hours
Have less stress
Stop commuting 3 hours every day
Work at something that honoured my values and inspired me
Make a real contribution through my work
Have time for hobbies
Retrain
Be able to travel
Be able to maintain my home the way I want to
Spend time with my family
Be happy
Nowhere in my list did I want vast wealth. I simply wanted a life where my choices and goals were not influenced by the need to make money. I wanted to be me and to be able to do what I wanted to do and not be restricted by a lack of money.
Step 3 – Make it measureable
You can put a figure on the amount of money you feel that you would need to achieve the things you want to do but remember that financial freedom is a feeling as well as a measurable choice.
Tim Ferris put it very well when he said
“Money is multiplied in practical value depending on the number of Ws you control in your life
What you do
When you do it
Where you do it
Who you do it with”
Over 5 years ago I became I coach. I can work from home. I can work in the evening or during the day. I can work from anywhere in the world if I want to. I can choose my clients.
I am still not making as much money as I did in my corporate job but some days simply having control over the four Ws makes me feel exceptionally wealthy.
In my next post I will tell how I challenged some of the blocks I had about money and began to turn my finances around.
What do you feel about financial freedom – pie in the sky or a possibility worth checking out? Tell me what you think?
{ 8 comments… read them below or add one }
My wife and my family are not to the point you are yet, but we were able to come from $80,000.00 in credit-card debt to just over $9,000.00. We have destroyed all of the credit cards.
We are starting to gain momentum, because we are all getting tired of having to go without many fun family activities. – Barry P. King, http://managingspending.blogspot.com
Hi Barry and welcome
You have made a huge turnaround in your credit card debt. That is really wonderful. I bet you sleep a lot easier in bed at night. Often either cutting up the credit cards or locking them up is a great way to get some control back. Another way is to do the 3 month cash challenge where you only use cash to make purchases. This forces you to plan ahead and helps prevent the impulse buys.
Thank you for dropping by I hope you will visit again.
Marion
Hi Marion,
What a great post. I really enjoyed it.
Thy myth about financial freedom is true.
We don’t have it when we’re working for someone else, or doing a job we detest.
Especially when we’ve grown dependent on a certain income.
I’m going through something like this myself – for the second time!
The first time I went running back to the security of a “job” after 3 years – now 13 years later I’m determined to make the break!
Thanks for this insightful article.
I’ll certainly be looking forward to the next installment.
Hi Angela
We do not have financial freedom when we rely on one source of income or on a business which we do not enjoy yet it represents a major source of income. Good luck on making the break. I hope I will be able to supply so more tips to help you on your way.
Marion
Marion: Great post. I do believe that it is important to always know what we are trying to accomplish with our finances. It is important to have a plan and something we can follow and base our decisions on. I think the way that you broke down the path to finding our own strategy was very helpful. Thanks for sharing and passing it along.
Hi Sibyl
It is good to have a plan so that we have something to aim for. We don’t have to stick to it in a rigid way but we do need to keep assessing it, seeing what works and tweaking it. I think we can get overwhelmed with money so taking things a step at a time is a good way to go.
Thank you for stopping by
Marion
Hi Marion,
I agree – a wonderful post and I can’t wait for your follow-up. Now that I’m debt-free (as of about a month ago) I’m socking away as much money as I can so that I can have choices in my life and not have to be tied to something that I no longer want to spend my life energy on.
Hi Karen
Congratulations – it can take a lot to become debt free. I hope you celebrated. Money like lots of things requires a balance to the get the most out of it. I will be talking about that in my next posts
Thanks for taking the time to comment and share
Marion