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In the 21st century the concepts of time and money are being redefined. ”Financial Freedom”, is one such term that has gained much importance in the changing financial scenario.
”Financial Freedom” means the freedom from continuous financial responsibilities through a planned management and allocation of assets. It frees a person from back-breaking work by giving him a steady source of income for life.
One must not think that a financially free person is also debt free. However, his prudent asset management ensures that his debts do not become a burden but only a part of his over-all expenses. In this way, his debts do not hinder his long term financial goals.
Financial freedom cannot be equated with being rich. One must not forget that surplus wealth requires constant supervision. In the long run, a rich man’s obligations do not make him ”financially free” in the true sense.
Thus, financial freedom maybe defined as a lifestyle that blends expenses and income according to the individual preference. This makes ”financial freedom” a more possible and convenient state of being.
Financial Freedom is Time Freedom
”Time is money”, is the general belief in the professional world. This attitude does not allow space for leisure time. However, financial freedom has changed this concept of work by enabling a person to enjoy leisure without hampering his steady income in any manner. The entire concept of “financial freedom” is based on assets and investments that are compounded over time to generate money. It takes care of the regular expenses and leaves a person with both time and money in his hands. A financially independent person is free from the clutches of time-for-money routine.
Achieving Financial Freedom
To understand ”financial freedom” one must come out of the traditional concepts regarding income and expenses.
We have been taught that timely work generates money. ”Financial freedom” opposes this concept of time-for-money swap and lets the money work for the individual instead. However, in spite of this advantage many professionals find it difficult to work without a fixed routine.
Thus, to achieve financial freedom one needs to change their old mindsets and develop a new attitude towards earning money. One must realize that money is simply the means to achieve ends.
One must also remember that a person cannot be judged by the money he possesses. Unless these misconceptions are cleared the entire purpose of financial freedom is defeated since satisfaction is the keyword to financial freedom.
Similarly, one must also get rid of the negative attitude towards earning money. While excess demand for wealth hampers one’s healthy relationship with finances, a healthy perception of money is necessary to maintain an over-all balance. Remember that one earns money to achieve ends and therefore, it is healthy and normal to earn money as long as one feels the ethical need to do so.
In the end, one may say that financial freedom is the state of mind which works towards development through a process of self liberation.
Realities of Financial Independence
Independence is a state of being every living being strives to achieve, and keep forever. From the moment a child sets foot in school, he is made to understand that the knowledge he gains from this point onward is for him to make intelligent use of, to shape his own future.
When one lives with his parents, he tends to take a lot of things for granted. Once one starts to earn his own living he is faced with two diabolical aspects: financial independence; and responsibility.
It is not enough to just earn money. A lot of factors crop up when one (sometimes arrogantly) decides to break away from the family and move into his own home. True, that now he doesn’t have to think twice before buying that extra pair shoes; after all, there is no father waiting at home to glare upon the packet in hand.
But one does have to think about the electricity bill that is due next week, the phone bill which now seems to be of an astronomical level, the laundry that needs to be picked up and the EMI that needs to be paid. The money that has been earned after hours of toil seems to trickle down into oblivion.
In Economics, we learn that a country grows only through investment. And investment is the direct result of savings.
Similarly, in case of an individual, his financial state grows through saving. Parts of this saving can be invested in stocks and bonds. And since emergencies and accidents don’t come with trailers before them, security in terms of Medical and other insurances need to be made.
Women in India have, for the longest time, been financially dependent on the men: first as a daughter on her father, second as a wife on her husband, and then as a mother on her children.
Although this has saved them the worry of earning their own living, it has come with its share of hitches as well. A wife abused by her husband is unable to leave him and sustain herself. Even after divorce, she is at the mercy of her husband for child support.
But with changing times the modern Indian woman knows how to make her own living. The power of money no longer manipulates her life.
To live off others brings with it self loathing and ridicule. Therefore, everyone should work towards financial independence and financial freedom.