Many of us have dreamt of a day that we wake up and there are millions of shillings or probably dollars that we have no immediate plans to spend. It does not matter whether it is from hard earned sweat, mysterious jackpot or any other sources. We would then equate that to financial freedom, at least since we are free to buy things.
As a young boy growing up in the village, I had an amazing and graphical picture of what financial freedom is. My mother has always been a very strict disciplinarian all along; we would often disagree on a number of issues, one of them being the fact that she denied us buying anything to chew from the shopkeeper, particularly biscuits. The fact that we were getting money from her made it worse. So, in my world, attaining financial freedom meant the day I would no longer be under her jurisdiction but also when I would easily be able to afford a few packets of biscuits!
So, what is financial freedom? It is generally described as independence or the state of having enough personal wealth to afford the basic necessities without having to work. This means that assets like land or other property are able to generate enough income to cover all the expenses in a given time, and guarantee a comfortable life to the beneficiary. This also means that it is possible to have a lot of assets which are held up with liabilities within financial institutions, such that the returns they generate do not cover periodic expenses. The owner of such assets cannot be described as financially free.
Recently I sat next to an old lady in a flight, who was on her third week in Africa. Of course I was curious to know if she was on a holiday or working. She explained that she was in her fourth and last week of holidays, and that she does this every year. She also mentioned that she used to work with an oil company in her native country, where she was able to invest in property from a tender age. The returns from rental income based on real estate investments are the source of financing her annual expeditions. This I believe is an exemplary demonstration of financial freedom.
How does someone attain such independence? Significantly like any other positive thing, it begins in the mind. Below are some of the steps that I believe a majority of the financially free will share with you.
Appreciate financial discipline
Like in the military, discipline is the basis for success of any strategy. Sticking within personally established budgets is not easy, but it is one step towards comfort and peace on financial matters. Of course, this does not mean total rigidity not to accommodate emergencies, but that script could be a bridge to one living within their means.
Turn savings into investment
It is important to save money, probably in bank accounts, but equally using the same funds for investment into income generating ventures is very important. The simplest thing ever is ensure funds in banks give the best returns, but more crucial would be seeking the help of investment advisors to get the best options. The irony of it is that of course if you do not save, where do you get the savings to invest?
Well, wishing you financial freedom, but take a step!
