What is Financial Freedom and What Does it Mean to You?

The idea of financial freedom can mean entirely different things to different people. Some consider it to be having enough money to do what they want.

For some, it is having enough income from investments to be free of any financial concerns for the future.

In reality, not many people can actually be unconcerned about financial matters – no matter how much they have. In fact, it is common to get more worried about finances as we get richer.

As for doing what they want, few will do everything they would like to do, no matter how much money they make or have. Health and time can limit us as much as a lack of money, after all.

Still, money certainly can buy more security and more freedom, to the extent that those things are possible, so let’s look at how we can actually use money more effectively to achieve financial freedom – whatever that means to you.

The “making money” part of the equation isn’t covered here. There are a thousand good books on that.

But since money does not bring freedom automatically, the following ideas address some of the problems we run into once we start making more, and what we can do to increase the odds of money actually increasing our freedom.

Financial Worries

We seek greater security for the obvious reasons (to pay the bills, get medical care when needed, etc.) as well as to simply feel more secure and safe.

Creating streams of investment income helps. If you have enough income, you are free from needing a job, and if it is from enough sources, you can be relatively sure that you won’t lose all that income at once.

But this is only true if your lifestyle remains within the means of your income – or below it.

A common problem here is that we often grow our lifestyles along with our rising incomes. And this makes sense if you were eating cheap noodles and driving rusty old cars previously.

The problem resolves itself in time if income rises faster than the new expenses you take on.

Of course, it’s a lot easier to escape the “rat race” and relax with your investment income if your expenses are lower. So watch your changing habits as your income and wealth grow.

You may discover that there is no natural level of comfort where you are content and that you continue to “need” more as you make more.

It’s a common problem and one that requires some self-reflection and self-work rather than just making more income.

Incredible as it seems, we know that even millionaires go broke feeding their habits, tastes, and the needs of the ego.

Another problem is that you can feel insecure, no matter how much you make. Sometimes having more money makes you more afraid of losing that income and wealth.

The solution to this is not in money itself, which only buys the little bit of physical security available to humans.

To free yourself from such worries, you have to look beyond money to better psychological and spiritual practices.

Financial Freedom Means…

Having assets and regular income can buy a lot of freedom of choice. Used properly you can live how you choose, go where you like to, help who you want, and buy what you want or need. “Used properly” is an important part of that statement.

A common problem people have is getting so caught up in the process of making more money that they forget why they wanted to make it.

Then they often adopt a lifestyle that eats up all the income which could have paid for their goals if they happened to remember them.

There are certainly people who do want that big home and several new cars. Still, others fall into that life as a consolation prize for a dream life; they just couldn’t figure out how to achieve despite their increasing income and wealth.

For example, to travel the world – if that’s what financial freedom means to you – you have to plan. Perhaps you’ll have to quit your job at some point – and why not?

If your employment is supposed to help you towards your goal, it better not becomes an excuse to pass up travel opportunities.

Decide what financial freedom means to you, and start making plans for that.

It may not seem like it, but money alone can come and go by the millions without offering freedom of any sort if it isn’t used wisely. Rather than just chase it blindly, make sure it buys what you actually value.