Why Your Financial Freedom is Worth the Effort
The following is adapted from Down Home Money.
You may think you need an inheritance or a trust fund to achieve financial freedom, but nothing could be further from the truth. I became a millionaire without those advantages or a college degree! Now I want to help others see their money and time differently. I want to inspire you to live your best life and become financially free.
You may feel anxiety and insecurity about your future financial stability. The traditional paths to retirement income through pensions and social security aren’t reliable anymore. If you haven’t been planning and working toward financial freedom and you want to change course, it’s never too late to start. Your financial freedom is within reach. Will it be easy to get there? No, but the hard work of becoming financially free is so worth it. Here’s why.
What Does Financial Freedom Look Like?
As a child, I watched my parents struggle financially to keep up with the Joneses. They both had college educations and we weren’t poor, but our family struggled to make ends meet.
I didn’t want that. I didn’t want to be tied to a job for the rest of my life. I wanted the option of working if I wanted to, not because I had to. I wanted to be free.
For sure, financial freedom looks different for everyone, but it’s worth pursuing given the current uncertainty around pensions and rising inflation. Before deciding if it’s worth it to you, you need to know what you’re working for.
So what is financial freedom?
I define it like this: financial freedom is having enough passive income to pay for essential living expenses so you can work if you want to, not because you have to. If you have financial freedom, you have options AND peace of mind.
You get to choose if you work, where you work, and how much you work. And you can rest easy knowing that your bills will always be paid and you’re living debt-free.
So how much do you need to reach financial freedom? That number is different for everyone based on your expenses and lifestyle. The key is that you have enough to cover the essentials (housing, food, transportation, etc.) without being tied to a J-O-B. This freedom gives you the chance to make choices based on what you enjoy and whom you want to spend time with, rather than bills you have to pay.
Why Pursue Financial Freedom?
Most people plan for some level of financial freedom at retirement age. People open individual retirement accounts and contribute to 401(k)s through their employer. They also plan on receiving Social Security benefits and pensions when they retire.
Unfortunately, these income streams are unreliable. Social Security reserves are predicted to be exhausted in our lifetime and people may not receive the full benefits they’re entitled to. Even if people do receive their full Social Security benefits, they are hardly enough to live on or rely on as your only source of retirement income.
You also can’t rely on employer-funded pensions. What happens if the company goes out of business? That retirement fund could disappear entirely or at least be drastically reduced. Inflation is a concern because the price of goods and services is rising faster than incomes.
You could have to work many years longer than expected if inflation continues to outpace your income. Longevity is a factor too considering that we’re living longer. Medical advancements and improved health habits have raised our average lifespan closer to 80.
While this is great news for the living, we will also need money to pay for our expenses much longer. Think about it this way: If you live ten years longer than someone from the 1970’s or 1980’s at $50,000 a year, you’ll need another $500,000 saved up for retirement.
Where is that money going to come from? You can’t rely on pensions and Social Security alone. And your kids are not a good plan either. As some Baby Boomers have learned, you could be taking care of aging parents and your adult children at the same time. This is another reason why you need to pursue financial freedom and multiple streams of passive income.
Balance Today and Tomorrow
Because we all need money to live, both now and in retirement, it’s important to get a plan now and start working toward financial freedom. I can’t imagine having to work a job for thirty years, hoping for a pension and a Social Security check. Those safety nets aren’t safe anymore.
Only you can take control of your financial future. Only you can eliminate financial worries as you plan for the best years of your life. We all want happy, peaceful, fulfilling, and purposeful lives, but it’s our everyday, small decisions that lead to financial struggles. If we keep our focus on financial freedom, we will make better choices day to day that will have a life-changing impact on our future. As someone who’s done the hard work, trust me: it’s worth it.
For more advice on why you should pursue financial freedom, you can find Down Home Money on Amazon.
Myra Oliver is a Kentucky girl who started her career as a hairstylist and became a real estate broker/investor and entrepreneur. She currently owns multiple Keller Williams Realty franchises. After earning enough passive income through smart saving and real estate investments, Myra sold her hair salon and retired in her thirties. Three years later, she found her passion in helping others build their own streams of passive income through real estate investments. Myra lives in Denton, Texas with her husband, Rick, and their chihuahua, Izzy. To learn more about financial freedom and living your best life, visit her website, downhomemoney.com.