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Many of us want to achieve the American dream: a nice house, kids, and a luxurious retirement filled with golf and fancy cocktails. We’re encouraged to save to a small portion of our income our entire working careers to create that retirement of our dreams.
Finally, after years of working, we’ll have enough so we can quit and finally travel, relax, and spend time with family. And hopefully, we still have enough energy to do all the things we’ve dreamed of for so long.
Pursuing a traditional retirement by saving 10-15% for 30 years is one way to buy back your time. But many Americans are exploring new ways to drop the soul-sucking job to create the life they want today.
Forget retirement and explore financial freedom now.
What is Financial Freedom?
Financial freedom is the point when you’ve saved enough that you can support yourself for the rest of your life without needing money. Many people can achieve financial independence well before qualifying for Social Security.
These savers created sufficient income streams to support themselves. There are a variety of ways to generate the income needed to reach financial independence.
Some people choose careers in the military to get a pension at a younger age. Others invest in real estate and develop relatively passive income streams. Some invest money heavily into 401(k)s, IRAs, and brokerage accounts to have enough investment assets to pay for their lifestyle.
Financial freedom is easier to achieve when you can reduce expenses and boost your savings rate. While traditional paths to retirement say you only need to save 10% or 15% of your income to reach your goals, people aiming for financial freedom often find unique and creative ways to save and invest 50% to 75% of what they make.
Financial blogger Mr. Money Mustache has an interesting post that allows you to see the math in action. It's a great illustration of the power of saving more.
Why Financial Freedom?
Why spend less for so long in order to achieve financial independence?
When you’re free from the necessity of earning money, you have the freedom to spend your time -- the most valuable thing you have -- as you see fit. You might stop working --or maybe not. You might travel around the world or pursue other important goals that you couldn't work toward because you lacked the freedom and flexibility you needed.
With financial freedom, it’s your choice.
Even A Little Helps
There are degrees of financial independence. Financial freedom isn’t created overnight, and even a little bit helps create a life where you’re less burdened to a job you hate.
It doesn’t take complete financial independence to give yourself more time and autonomy, and to leave behind a boring job. You’ll need some money, yes, but creativity, resourcefulness, and a drive to make it work mean much more.
If you didn’t have to work for money, what would you do? How much does that cost? And what can you do to get there? You can do work you love long before achieving complete financial freedom.
Choose the Lifestyle You Want
Some people want a traditional retirement. They’d rather spend more along the way, and keep working the 9-5 until their sixties or later. But if you’d like to have the freedom to leave behind the corporate grind sooner rather than later, begin the pursuit of financial freedom now.
About the Author: Jenna VanLeeuwen is a freelance writer who enjoys helping others make the most of their money to create a life they love. Connect with her on Twitter @JennaVanLeeuwen to join the fun.
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What Does It Mean to Pay Yourself First?
What Does Financial Independence Look Like to You?
