Free yourselves from your "Golden Handcuffs"

Get off the hamster wheel
Society programs us to live a certain way. A big reason we can't get off the rat race is that we are programmed to consume. There's always an excuse why we need to part with our money. Yet, we dream of exiting the rat race and achieving financial freedom. We yearn for the ability to do what we truly love, rather than living to work. Achieving financial freedom is having the autonomy to pursue your passions and live life on your own terms. This will help empower you to do the things you've always wanted to do.

10 Ways to get you STARTED:

#1 Set Very Clear Measurable Financial Goals with Specific Deadlines
"There's no unrealistic goals, just unrealistic deadlines" - Brian Tracy
The journey to financial freedom begins with setting clear and achievable financial goals. Use the SMART method.
S - Specific
M - Measurable
A - Achievable
R - Realistic/relevant
T - Time-bound

Whether it's paying off debt, saving for retirement, or investing in your dream business, having well-defined objectives is crucial. By setting specific goals, you can create a roadmap that will guide your financial decisions and keep you on track. Vague goals are akin to being lost.

Example:
Financial Goal: Retire in 5 years, with enough passive income in order to pursue other aspirations. Convert that into the smart method strategy:
Specific: I will retire from my current job in 5 years.
Measurable: I will have $1 million in my Portfolio by the end of the 5 years.
Achievable: To achieve this goal, I will max out my annual retirement investment contributions, explore investment opportunities/passive income and allocate and 50% of my monthly paycheck into it, and of course minimize unnecessary expenses.
Relevant: Retiring in 5 years aligns with my long-term financial plan and personal aspirations, allowing me to focus on other life goals such as working remotely and the ability to reach and help even more people.
Time-Bound: 5 year timeline.
This is just one example. You can tailor this method to your specific life circumstances.

Managing your money is a fundamental step toward financial freedom. Creating a budget allows you to understand where your income goes and identify areas where you can save or invest more. A budget helps you allocate resources efficiently, ensuring you're making the most of your hard-earned money.
Paycheck amount per month $10,000 (this is not a lot in San Francisco, in case you are wondering)
Make it easy for yourself:
Set up your direct deposit to automatically funnel and divide your paycheck into categories. When you eliminate steps/hurdles you need to go through, the process will be easier for you to follow, guaranteeing success.

50% - investments. Contribution to your retirement plan if your employer provides it. If they match, at least contribute up to the % that they will match. Set up your own brokerage retirement plan if you do not have the prior option, or even as an addition to the prior option. Fidelity and Vanguard are a couple of examples where you can set up these accounts.

5% - medical/dental/vision
10% - groceries, transportation, gas, maintenance of vehicles
30% - rent/mortgage/utility bills (the mandatory "roof above your head" living expenses)
5% - fun money for travel, eating out or whatever you decide is valuable to YOU.

Please note that the percentages and the examples are just examples. You can tailor them to what works for you and your family.
extra cash? - keep in high yield savings account. Keep it liquid to bulk up your emergency fund for that unexpected vet bill(s) or roof repair.
By the way, if you don't know how to allocate your money properly, you are probably also not great at budgeting your time which is even more important! Money can keep flowing, but your time is finite.

#2 Save and Invest
Saving and investing are essential components of financial freedom. Saving ensures you have a financial safety net, while investing allows your money to grow over time. 6 months - 1 yr of liquidity is the usual safety net for most people. It all depends on each person's way of life/comfort level/ family situation, etc. Not one number fits all.
Simply saving money is not enough to fight inflation. Investing can maintain, if not upgrade, your purchasing power over time. Diversify your investments to minimize risk, and consider long-term strategies, such as businesses, retirement accounts, mutual/index funds, and real estate. Think of starting a simple business like blogging or better yet, scout for another business to buy. Sometimes it can be easier to purchase an established small business instead of starting your own. However, this is not a newbie move. This requires a lot of research and education on the back end prior to acquisition.

#3 Eliminate Debt
Debt can be a significant obstacle to financial freedom. High-interest debt, like credit card balances, can eat away at your income thanks to the power of compounding. Make a plan to pay off your debts systematically, starting with the highest interest rates. Once you're debt-free, you'll have more disposable income to invest and save. Not all debts are bad, if you scored on low rate mortgages during the pandemic, there is no rush to pay this off, as you can instead use the money to invest.

#4 Make more money

Increasing your income is another way to expedite your journey to financial freedom. Look for opportunities to boost your earnings, whether through a job promotion, side gigs, or starting a small business. Multiple streams of income can provide financial security and speed up your path to freedom. Explore passive income streams such as content creation and rental income (Airbnb/VRBO/bed & breakfast).

#5 Education

One sure way to boost your earnings is education (knowledge). This doesn't have to be formal. There are tons of free educational resources available online. Borrow the books and study, watch free lectures on YouTube, and form a mastermind group. The only thing stopping you is yourself.

#6 Spend Less than What you Make
Yes it truly is that simple. A common occurrence is Lifestyle Inflation. As you increase your income, your lifestyle tends to increase at the same rate, this is called "lifestyle creep". Remember the Japanese proverb, "Getting money is like digging with a needle, spending it is like water soaking into sand".
When I want to spend money on motorcycle gear which isn't cheap, this is how I approach the situation:
Adventure Motorcycle gear top and bottom $1000.
How many hours after taxes do I have to work in order to pay for that?
This thinking allows me to reflect and re-assess if I really need it or do I just want it?
Am I willing to spend many days working extra so I can have the latest gear?
Not a chance.

#7 Be financially literate

Financial literacy is an essential tool on the road to financial freedom. Take the time to educate yourself about personal finance, investment options, and financial planning. The more you understand, the better equipped you'll be to make informed decisions that align with your goals. Unfortunately, a lot of schools do not cover enough financial education. Fortunately, with the internet, education has become ever more easy to obtain. Your Biggest ASSET is your TIME, but also a close 2nd is your BRAIN. Read about personal finance. It's all over the internet, like this blog :D Borrow books at the library. You do not need to spend a ton of money for education despite what society is telling you to do. You do not need to formally study this in a classroom to learn it.

#8 Build Passive Income
One of the hallmarks of financial freedom is having passive income streams. These are sources of income that require minimal effort on your part, such as rental income, dividends, or royalties. Building passive income can provide you with the freedom to pursue your passions without being tied to job that controls your most valuable asset. Beware of the term "golden handcuffs." They are called handcuffs for a REASON.
Caveat: Passive Income often requires a lot of hard work in the beginning. Most passive incomes are not truly passive, but mostly passive. They still require your attention from time to time. But guess what, it's more satisfying realizing at that point, you are NOW in control of your TIME. It feels great.

#9 Safeguarding your financial freedom is just as important as achieving it. Invest in insurance, estate planning, and other protective measures such as prenups to ensure that unexpected events don't derail your financial goals. Life happens. If you can't pay for it out of pocket, then insure it. You don't want to be in a situation where you did not adequately insure and now have to use CREDIT to pay for it (that is the complete opposite of what we're talking about here).

10. Don't wait to start pursuing your dreams. Do it now, while you work towards your financial freedom. If you make it wait, it may eventually escape you. Then when you do achieve your financial freedom, you've already created momentum towards your passions. Whether it's traveling the world, starting a business, a charitable foundation, or dedicating yourself to a hobby, financial freedom gives you the time and resources to do the things that really matter to you the most.
...with your parents/grandparents who aren't getting any younger.
...watching your child/children grow up.
...making more friends
...helping more people
...creating a community

Financial freedom is a journey that requires dedication, discipline, and planning. By setting clear goals, managing your finances wisely, and investing in your future, you can unlock the door to a life where you're free to pursue your passions and dreams. You do not have to wait until your 65 years old. Remember that achieving financial freedom is not just about accumulating wealth; it's about living life on your own terms and doing what truly matters to you. Start now! After reading this, take 1 or 2 steps towards the financial freedom you deserve. Write in comments what steps you are willing to take, even the smallest ones.


Bonus section:

Here are 6 books to help get you started on your financial literacy journey.

















Disclosure: This Blog is reader-supported. This page contains affiliated links and we may get a small commission if you buy through links on our site. It will not cost you extra in doing so but it will be a great support for us. Thank you in advance.