Financial freedom is a damaging myth that perpetuates the idea that we should all be striving to escape from our lives through early retirement.
Here’s why I think we should be shifting our perspective from financial freedom to financial independence.
On the go? Here’s 30 seconds of take outs:
- Financial freedom is a hot topic, but it perpetuates harmful ideas about how we should be living our lives and what we should be aiming for.
- Financial independence, on the other hand, gives us space to think about investment strategies that support people to do what they love, follow their passions and create an ideal work-life balance.
- Feeling grateful for what we have and setting in place a gradual retirement plan can help us shift from feeling like we need freedom from our lives to helping us live the life we want right now.
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Financial freedom is a hot topic with investor magazines and companies in the property investment industry. The concept thrives off the idea that we’re all out in the world living lives that we loathe, detest, greatly dislike and that we need to be free from. And the solution is buying up a bunch of property so we can go sit on the beach and sip pina coladas.
But the concept of financial freedom really riles me up. Because let’s be real, after a couple of weeks on the beach you’d be sick of pineapple and coconuts and bored out of your brains.
Look, I love the beach just as much as the next person. I’ve gone on two and three-week long surfing trips that have started out as pure, idyllic heaven. But by the end of them I’m feeling pretty busted up. I’ve got surfing rashes starting to form where I didn’t think there would be surfing rashes, my ribs are bruised, and I am dead set spent! There is only so much surfing one can do all day every day.
Even if you don’t love your work as much as I do and you haven’t found your dream job yet, think about all the positives that work provides you with. You can earn an income and use that income to set yourself up or find something that is more conducive to what your ideal career would be.
I think we should be switching financial freedom for financial independence.
Financial independence means being able to do what you love, follow your passions, do something that you lose time in and that feels like your calling – what you’re meant to be doing it.
Financial independence is an effect not a cause. It is the by product or of doing what you love.
It just comes down to perspective. Shift your thinking from wanting to fully retire to finding what you love to do so you can reap the benefits of financial independence.
Nothing is stopping you living the life you really want to live right now. As Einstein says, ‘we are boxed in by the boundary conditions of our thinking’.
The reality is that you might already have financial independence if you compare your situation to that of many other people living in other countries in the world. If you have a roof over your head three square meals a day, access to running water and you make more than $40,000 a year you’re in the top 1% of the world in terms of the median annual household income (worldwide median annual household income $9,733).
In other words, you are already financially independent beyond measure in the eyes of 99% of the world.
Here’s a question. Let’s just suppose for a second that you had all the money and all the time the world, what would you do with your day?
Most people don’t have a clear answer but if you are one of the fortunate ones who do, what are you doing with your time and your life right now? And what do you need to do to get yourself closer to your answer?
You see retirement and financial independence is simply doing what you want when you want to do it. Each successful Forbes 100 businessperson has retired into their job, they have fallen in love with what they do. They are passionate about it not because they have to work but because of how and why they are working.
I am a massive fan of the gradual retirement plan. This means as you do what you love you create a base of income producing assets to supplement your income. With this strategy, over the course of your life you can get a better control of your time until you find your happy work-life balance.
It’s really replacing one income for another over time. The thing you gain eventually is time and the choice to do whatever you want with it.
By planning for financial independence early on, you can start to build an asset base which can help you slowly transition into your ideal lifestyle.
Essentially, my hope is that you never feel the need to be free from your life; that you find your life’s calling, that thing that you’re good at and you’re meant to be doing. The thing that you’re passionate about and you do because it helps those around you and assists you to grow and contribute.
When you find your calling is not working or a job it’s an extension of who you are. Be brave, make a difference in the universe!
Get some experts around you to help you on your way: Pinnacle Program Support