Alright, let’s talk about financial freedom— a term that echoes in our minds, prompting questions and reflections. I’ve pondered it for years, and I’m sure you have too. But what really is financial freedom?
In a recent live course I posed this question to participants asking them to share their thoughts. Here are some compelling responses I received:
Keeping An Open Mind: One perspective sees financial freedom as keeping the mind open to possibilities, taking responsibility, and making desired outcomes happen without blame or excuses.
Empowered Choices: Another viewpoint focuses on the ability to make choices, driven by the possession of resources.
Dining Without Worries: For some, it’s about going out to dinner without glancing at the menu, enjoying a meal without financial worries. It’s also about the freedom to grow a business without fretting over bills.
A Personal Dream: One participant dreams of helping their parents pay off their mortgage and treating them to a vacation—a motive that sparks actions leading to financial resources and, hopefully, the fulfillment of their dream.
The Essence of Financial Freedom
In my world, financial freedom goes beyond the state of the pocketbook. It’s about making decisions that have a net positive impact on life and the lives of those we care about. It’s a mindset, a state of financial life.
I don’t believe you need passive income to be financially free. For me, it’s about spending less than you earn, creating a mental mindset of financial freedom.
The Ultra-Rich Perspective
Now, let’s talk about the ultra-rich. Yes, those with multiple millions or billions in their bank accounts. These rare people have so much money that they never worry about their finances or so it seems, right?. They don’t need to think about if they can afford a fancy meal, or a vacation. They can get whatever they want, whenever they want. What’s interesting about these people is that despite their financial freedom, they still have financial worries in life, but they are much bigger and often different worries. They still worry about making payroll, paying their large mortgages, private jets, AND they worry about achieving their life’s purpose.
The Simplicity of Financial Freedom
Let’s simplify the concept. Financial freedom doesn’t demand business ownership or millions in the bank. It requires just one more dollar at the end of the month than you spend. Even a penny more can make you feel free. But if you’re spending more than you’re earning, you’re not free because by spending more than you’re earning, you’re going more into debt.
The middle-ground definition provided by one participant resonates well. They dream of helping their parents with a mortgage and a vacation serves as a motive. Having that motive leads to action, which will lead to more resources coming into this person’s life. If the dream is big enough, we can overcome any difficulty, any obstacle to make it happen.
As the saying goes, the truth will set you free. By organizing your financial life, understanding your money, and ensuring you’re spending less than you’re earning, you know the truth about your spending and that will set you on a path to financial freedom.
Having What You Want, Wanting What You Have
A mentor once shared a powerful phrase about financial freedom. He said, ”Financial Freedom is having what you want and wanting what you have.” How often do we buy things because we think we want them, only to realize it wasn’t what we truly wanted? It’s time to get clear on your financial vision, focusing on what matters most to you and going after it.
Forget about others’ opinions; focus on what you think of yourself. Work towards what matters to you, achieving the things that resonate with your dreams.
So, in essence, financial freedom is not just having what you want but also wanting what you have after you’ve acquired it. It’s a journey, a mindset, and a state of your financial life. It’s simpler than you think—just one more dollar, and you’re on your way to feeling truly free.