Courage Plays a Massive Role In Financial Freedom

What is financial security?

Financial security means different things to different people. To some, it may mean having enough money to cover all your bills, save for retirement and then have some left over. To others, it may mean earning a six- or seven-figure income, maintaining a robust investment portfolio, and owning several real estate properties. Regardless of your interpretation of what it means to be financially secure, it’s likely on your long-term list of financial goals to achieve financial security.

At a broader level, ensuring financial security should also include a personal insurance plan, which can replace your financial value to your family if you were to suddenly die or become permanently disabled. If you suffer an injury or illness that prevents you from earning income for an extended period, income protection insurance can offer extra security for you and your family.

Financial freedom is quite different

If you are financially secure, you can certainly get by — but what if you want a bit more out of life than just preserving a basic existence? Financial freedom, in essence, means having the resources to make decisions about what you buy, do, or see without having to worry about impacting your basic living standards in the future. It means having the freedom to fulfill dreams of where you live, how you spend your time, which travel destinations you can experience, and how you can support your family.

This kind of freedom is something that very few people are able to achieve, but it is not limited to those who are born into money, inherit money, or win the lottery. Financial freedom can be achieved by an ordinary working person if they have the vision — and employ the methods, planning, and habits — to get them there.

It starts with an attitude

Financial freedom can be a realistic goal for many of us but it won’t happen by accident. The formula for achieving financial freedom involves several key aspects that need your deliberate action and attention.

The fundamental characteristic of those who build their own financial freedom is an attitude and a belief that they can achieve a lifestyle beyond their current circumstances. This means having the confidence to dream big and visualize those specific things that you want to enjoy in life.

Being clear about your dreams, and putting them down in black and white is the next step. Really owning your dreams in this way will give you the motivation and impetus to take action toward them.

You then need to break down the financial requirements needed to get you to your goals — your financial plan. This is where the nuts and bolts are worked out on issues such as budgeting, saving, and investing. Without a solid financial plan, financial freedom will only ever be wishful thinking.

Financial freedom requires a major act of courage

If I was in my 20s, did not have an infant son to take care of, and didn't have some of my past financial/emotional baggage, it would be much easier for me to “have the courage” to take the leap into pursuing a full-time writing career. So, financial decisions are not made in a vacuum. Smart decision-making needs to take into account all the other variables in your life. This is especially true when you’re making decisions that could jeopardize your income, which, as we covered, is the most important asset in your financial toolbox.

My plan requires basically zero “courage” on my part but a lot of hard work. I’ll continue working my 9–5 and my side hustle and investing all of my money left over at the end of each month.

Once the passive income from my investments is enough to cover my basic living expenses, I can become a full-time writer and achieve my personal definition of financial freedom.

Every decision has an opportunity cost. Making smart decisions is about determining which cost you are willing to pay. I am perfectly fine working extremely hard for the next few years to put myself in a position where I never have to worry about money again.

The bottom line:

Financial freedom means different things to different people but generally denotes having enough savings, investments, and cash (coupled with little to no debt) so you can afford the kind of life you want. Individuals can take small steps each day toward this goal by following a budget and paying close attention to their finances. This will lead them to take leaps toward a more secure financial future.

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