However you do it, the important thing is to think about it now instead of facing the realities later. And maybe you’ll choose a combination of strategies to arrive at a plan that’s uniquely yours.Or maybe you’ll downsize and reduce your cost of living.There are lots of ways to accomplish financial freedom in retirement. But affording it has less to do with how much you earn and more to do with how well you plan for it. 14 Tips for Achieving Financial Freedomįinancial freedom sounds like a great idea, for those who can afford it. can help you set and achieve these goals. Donate a large sum to a charity or hospitalĭocumenting your financial plans in an online retirement planning calculator can help you set and achieve these goals.Traveling for a year or more without dealing with financial strain.Going into a career you enjoy without worrying about money.Your goals for financial freedom could be: Whatever your dream might be, dream big and go for it. We have different desires when it comes to financial freedom. What Does Financial Freedom Mean To You?Įach of us has different goals for our lives. Financial freedom and fulfillment in life go hand in hand. This fulfillment decreases the need for overspending on non-essential things. This non-employment income may come from a side business you enjoy.Ī side-business or blog are likely things that you are passionate about. Permanent financial freedom: In this stage, you have an iron clad written financial plan where your non-employment income greatly exceeds your spending. This temporary freedom only lasts until your income is spent. This is because you are using your savings to purchase these. These freedoms are only temporary, however. With this freedom, you can switch jobs, get more education, or even travel. Creating another income channel adds to your savings. You can even begin your own business or side hustle. This isn’t restricted to raises and bonuses at work. You must make more than you spend to remain in this stage. Temporary financial freedom: This stage requires a pool of savings. Until you make more income, you remain in this stage. It’s difficult to save money at this stage since you need every cent you make. No financial freedom: At this stage, you rely completely on your paycheck to cover spending and pay debts. But what exactly does financial freedom look like? We can break it up into three levels: We want to spend our retirement relaxing and reaping the benefits of our hard-earned income. You know exactly what you can spend, are free to do what you want (within your budget), when you want and without worrying about financial consequences. If an issue comes up, you don’t even bat an eye because you are secure in your finances to pay for the fix. True financial freedom is the feeling of being without financial stress.With financial freedom, you have the independence to live stress-free. But what is it really? Is it freedom to buy new shoes on a whim? Splurge on fresh strawberries? Buy tickets to the Superbowl? Freedom to never ever work again? Freedom to never worry about money again?
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