How Many Years to Financial Freedom?

How Many Years to Financial Freedom? Is a huge question and one that many ask! Financial freedom, You hear a lot about it these days and it seems like lots of people are talking about achieving it. But what is it really and how long will it take for you to get there? Let’s take a look.

How Many Years to Financial Freedom?

What is Financial Freedom?

You will often hear that financial freedom is crucial to your success, well-being, and ultimately, your happiness. But what is financial freedom anyway?

Financial freedom is the ability to maintain your current lifestyle without having to go to work for someone else and punch a clock. It can be achieved by creating enough passive income to replace your earned income.

Financial freedom is not paying off your mortgage, credit cards and other debts. You cannot attain financial freedom by paying off debt alone. Only by bringing in enough monthly passive income to pay your lifestyle expenses and your debts can you say true financial freedom has been attained.

How Many Years to Financial Freedom?

How Long Does It Take to Achieve Financial Freedom?

Just how long it would take you to achieve financial freedom is not easy to predict. It means different things to different people. Some simply want to be free to continue living their current lifestyle without working for someone else. Others want to elevate their current status and do want to move towards a more carefree, and debt-free, existence.

So while there is no one size fits all timeline to financial freedom, there are some things you should start working towards today that will get you there faster. And there’s no time like the present, as the younger you are when you get started the faster you can achieve financial freedom and enjoy all that comes along with it. Here are some pointers to get you started.

How Many Years to Financial Freedom?

Pay Down Your Credit Card Debt

Reducing or eliminating credit card balances and other high-interest debt should be a top priority for most people. Even the lowest-interest credit cards have annual percentage rates of around 9.5 percent annually on balances, so paying off that balance is akin to giving yourself at least a 9.5-percent return. Not bad for starters!

How Many Years to Financial Freedom?

Save and Invest 10 to 20 Percent of Your Income

“Paying yourself first” is key to achieving financial freedom, and works best the earlier you start doing it. Each pay period, transfer a portion of income into an investment account, then leave the money alone. Ask your employer to set up direct deposit, or arrange with your bank or credit union to have money from your checking account moved automatically.

The first thing you should do with these savings is to build up a financial reserve, aka and emergency fund. How much that should be is something that experts still tend to disagree on. Some say that saving two to three months of expenses is enough, while others recommend amassing enough to cover six to eight months’ worth of expenses.

How Many Years to Financial Freedom?

Start Getting More Aggressive

However, that emergency is just the start. You will need to start investing a little more aggressively if you want to build wealth faster. There are lots of options out there and getting help is a must. This does not have to mean planning to take a degree in economics, or paying a fortune to a personal broker though. Getting advice from a financial advisor is easier, and far more affordable than you might think and is one of the best ways to fast track your path to financial freedom.

How Many Years to Financial Freedom?

Live Within—or Below—Your Means

Adjusting lifestyle expectations is hard to do, but it could be the best way for many of us to secure financial freedom. That may mean cutting back on vacation travel plans, going for that less expensive car or sticking with your current home rather than ‘upgrading.

Establishing a financial plan and being flexible can help. Ultimately, successful consumers who find financial freedom make deliberate efforts to keep their savings on track no matter what life throws their way, and that way they can achieve financial freedom faster than they had ever thought possible. Get further advice from our independent financial advisors here.