Financial Freedom is Our Only Hope
These words were made famous by Jay-Z in his popular song The Story of O.J. on his most recent solo album 4:44. Although we all hear the song being played constantly on the radio and may sing along, many of us may not know what financial freedom actually is and more importantly, how to get there. Well today, I not only will be explaining what financial freedom is but also provide a brief plan on how to achieve it. I hope this article can be viewed as a realistic approach to achieving financial freedom and allow you to see that anyone can achieve it if they are willing to plan properly, take action, and most importantly change their mindset.
What is financial freedom?
To simply put it, financial freedom is the ability to support yourself and maintain your desired lifestyle without requiring a regular paycheck. Usually people who are financial free have little to no debt and the debt that they do have can easily be paid off with the income that they bring in or the money they have saved. Most people who are financially free do not work a regular 9-5 and are free to do whatever their hearts desire.
All I need to do is become rich right?
Not exactly. The more money you make does not directly imply that you are financially free. Sure, you may be living your best life without a care in the world while the money is coming in, but what happens when the money slows up or stops completely? What do you do then? How to you pay your bills? How do you provide for your family? This is an all too common story for many people who have accrued wealth quickly, like rappers, entertains, athletes, and even lottery winners. Just because you have money does not mean you know how to manage or budget it. This is where the importance of having a solid financial education comes into play. Although our educational system does a great job in providing knowledge and skills for different career opportunities; it does a terrible job a providing us with real life skills on how to manage our money and invest. These are the keys to financial freedom and without them, financial freedom is unobtainable.
How smart do you have to be to be financially free?
Financial freedom has nothing to do with intelligence at all and is a skilled learned through accumulating knowledge on proper money management and investing, as well experience through trial and error. In fact, there are many people who are viewed to have very high levels of intelligence who are not financially free at all. These people include: doctor, lawyers, engineers, and even scientist. You may be thinking “How is that possible, I thought they made lots of money?”, but once again it is not about how much money you make but how much money you keep and what you choose to do with it.
Can’t I just hire somebody to manage my money for me?
Many of you might be thinking,” If I had a lot of money, I would just pay somebody to management it,” and although in theory that works, in reality it is one of the worst mistakes you can make. Hiring somebody to manage your money, also known as a financial advisor, is a good idea, but only if you already are literate on how to properly budget your money. If not, you will open yourself up to be taken advantage of, with financial advisor being infamous for robbing their clients blind. Bringing in an income, especially a large income without having solid financial education is equivalent to attempting to drive a car with a gas tank on E. You won’t get far.
What are most people doing wrong?
This question tides directly into what you should be doing in order to achieve financial freedom. For starters, most people are living beyond their means. The quickest way to financial freedom is by living below your means until you have enough income coming in to support your lifestyle without having to work or trade your time for money. Most people in society feel as though they must have the newest things in attempts to “Keep up with the Joneses”. This is the single most counterproductive thing you can do to derail and prevent yourself from ever reaching financial freedom. People go thousands and thousands of dollars into debt in attempts to look “rich”. An example of this would be taking out a $30,000 car loan for a car that you do not need or can barely afford without having to work countless hours to keep up with the payments. Someone in this same situation could have easily gone out and got one for a fraction of that price and avoided the strains of paying the burdensome car payment. Spending excessive amounts of money on things like cars is a trending pitfall for many Americans, both young and old. Sure, you may look good riding in it, but you must remember that it is a depreciating asset, meaning that that car loses value every day you have it. I get it; we all want nice things but if we just hold off on the unnecessary spending and make the temporary sacrifices now, we will for sure obtain them in the future and we will not have to worry about going into debt to get them.
A few other things people are doing incorrectly is failing to budget and keep track of their spending. How many times have we all gotten paid and then after a few days, we are right back broke and do not know where our money has gone? A budget should be viewed as monthly or weekly plan on where you plan to spend your money. It allows you to keep track of where you want your money to go. Tracking your money properly and budgeting will ensure that all of your money is being accounted for, so you can monitor your spending habits and make smarter financial decisions. By doing so, you well be able to decide what you can cut back on in order to invest and increase your savings, which will help grow your money for the future.
What is the single important factor in achieving financial freedom?
As I mentioned earlier, the most important factor in achieving financial freedom is mindset. If your mindset is not geared towards becoming financially free you will never achieve it. A mindset focused on reaching financial freedom would involve you making the best decisions financially to reach your goals. These decisions are not only limited to spending habits, but also include educating yourself on different financial topics, believing in delayed gratification and remaining consistent and determined on your journey to obtaining financial freedom. Of course, you may mess up sometimes and spend more than your budget intended, but it is important that when this does happen you hold yourself accountable and get right back on track.
How do I reach financial freedom(brief plan)?
In order to reach financial freedom, you must first payoff as much of your debt as possible due to the fact that you want to keep the amount of debt you do have very limited. You should start by paying off debt with the highest interest rate (bad debt) and work your way down. There is a difference between good and bad, but bad debt will nearly always have the highest interest rates. Bad debt is usually consumer debt and consists mainly of credit cards and car loans. Good debt consists of things like student loans, real estate and business loans. After paying off all of your bad debt you want to start saving your money in order to invest in other income streams such as passive income or a small business. Some examples of passive income streams include real estate, stocks and bonds. The idea is to have as many streams of income as possible so that you always have some form of income coming in. From there, it’s pretty simple. Just keep reinvesting your money into the same or new income streams, keep your bad debt down to a minimum and live below your means. Before you know it, you will have enough cash flow coming in to officially be considered financially free.
Why should I care about financial freedom?
You should care because financial freedom gives you the option of doing whatever you want in life. Rather you love or hate your job, wouldn’t it be nice to not having to worry about money ever again? Wouldn’t it be nice knowing that if you lost your job, you could still provide for yourself and your family without a problem? Financial freedom allows you to do the things you always wanted to in life and discover passions you never knew you had. It allows you to travel the world, live life to its fullest and do those things you always wanted to do but never had the time to. By no means is achieving financial freedom easy but with some hard work, consistency, determination, and the right mindset, it is without a doubt obtainable. So, I wish you the best of luck on your journey to financial freedom and I hope that once you reach it, you give back and help others achieve it as well.
-Pieces of a Man
“A big part of financial freedom is having your heart and mind free from worry about the what-ifs of life.”
— Suze Orman
Pieces Of A Man 
What a article. Financial Freedom is the key to a happy life. Being able to make money while you sleep. Beautifully written.
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Maybe talk about ways to flip things ex. Dollar tree domain names on Go Daddy. Taking hobbies amd turning them into side hustler
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“Keeping up with the Jones” I loved how you explain that we somewhat desire to want things that aren’t in our Financial category . I think it’s natural to want things that our “peers” have but to be mindful about the end result of obtaining expensive things. I think we don’t understand the importance of being financially free until we are wanting much important things that we could actually be making a profit from . Not having a proper budgeting system and spending unnecessary money .
When I originally read this post I felt the same way and now doing this time it still applies but 6 times more. Those that depended on a job to make it and lost income do to the pandemic.
Financial freedom is key !!
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