If you haven’t gathered yet, this blog is going to predominantly be about financial freedom and early retirement. What is this specifically? Well, it all boils down to having enough money saved and invested to provide an annual inflow of cash that covers your day-to-day living expenses. For example, if you added up all your annual living expenses and figured it was $50,000 per year, and you had an investment portfolio providing an after tax cash flow of $50,000 per year, you have reached financial freedom, can quit your job forever and do whatever the hell you want.
Some readers by now might be thinking…
I don’t care about money or early retirement, in fact, I actually LOVE my job and wouldn’t quit with all the money in the world!
Well, congratulations! A quick google search tells me you’re in the minority, with only 13% of people actually enjoying their job. That tells me the remaining 87% of people would more than likely give the middle finger salute to working if they were given the opportunity. That’s a big chunk of society.
But let’s address those that would continue to work, even if money wasn’t a reason. What are the benefits of financial freedom outside of the ability to quit work? Well, there are bloody tons:
1. Start Your Own Business
How many people have put off starting their business because they need to pay the bills, and starting your own business is too bloody risky? I bet it’s a lot of people! When you reach financial freedom, you can pursue whatever endeavour you want without any risk of being unable to pay your living expenses.
2. Spend Time With Children/Family
This is probably pretty high on anyone’s list who wants to become a parent. It doesn’t feel great shunning your kid off to daycare day in, day out whilst you have to go and work like a dog for the day just to get by. Financial freedom gives you the ability to screw that and give your child the nurturing attention (s)he so craves.
3. Unlimited Travel
There are many financially free bloggers that use their riches to travel the world, permanently. My fellow millennials over at Millennial Revolution are currently doing this on just $40,000 per year for two people. This becomes an even more powerful possibility if you have a location independent job, allowing you to work and travel simultaneously.
4. Follow Your Passion
Similar to starting your own business, many people give up their passions early in life because they simply don’t pay the bills. Poets, musicians, and artists the world over give up their burning passion to pursue a soul crunching lifetime sitting at a desk, all because they need to bring in some dough. Financial freedom allows people to stop doing things they hate and start doing things they bloody love, even if it doesn’t pay anything.
5. Unemployment Insurance
Okay, so you love your job and wouldn’t give it up, I feel ya. But what if you’re forced to give it up during the next financial crisis? How are you going to make ends meet then? Financial freedom is the best bloody unemployment insurance you can imagine, as you always have a comfortable cash cushion to fall back on when times get tough.
6. Confidence in Taking Risks
When you always have to worry about your next paycheck, your sole focus is usually on keeping your job at all costs. To do so you might end up playing safe cards throughout your life and actually hold yourself back from really putting yourself out there. Financial freedom gives you the confidence to take risks you otherwise wouldn’t as you know the worst that can happen is you have to rely on the enormous mountain of cash you’ve stashed away.
7. Having Boat Loads of Spending Money
As a fairly frugal/minimalistic person I don’t encourage spending extravagantly too much as it generally detracts from the goal, but if you’ve already reached the goal and want to keep working, financial freedom gives you a boatload of extra spending money to pursue passions you couldn’t afford to do otherwise. What would you do with an extra $50,000 a year, that you’re earning on top of your salary, for doing absolutely nothing? That’s what financial freedom feels like.
8. F@#% You Money
My main man JLCollins introduced this term to the financial freedom world and it’s so fitting I can’t help but use it in this list. F@#% you money basically means you have the ability to tell your employer (or anybody you rely on financially) to F@#% off whenever you want without having to worry about the financial repercussions. If that’s not a beautiful thing I don’t know what is.
9. Stress-Free Living (Better Health)
The American Psychological Association has claimed stress is linked to the top six leading causes of death. And guess what the leading cause of stress is? You guessed it, money and work. Financial freedom completely obliterates any financial stresses you might have and lets you focus on all life has to offer.
10. Ability to Help Others
There are many of us who would love to help specific causes or society at large but simply don’t have the time or money to do so. Financial freedom provides both time and money to those that might want to pursue more philanthropic endeavours. Hell yeah!
11. More Time
In the US, the average retirement age is 63, and the average length of retirement is 18 years*. This means the average person works around 45 years to enjoy just 18 years in retirement? How is that fair? Financial freedom allows you to tilt the table back in your favorfavouring you many more years of freedom to do what you want in life, not what you have to.
I could probably think of a few other reasons, but 11 seems a nice random place to stop. Long story short, financial freedom is a bloody fantastic goal to pursue, even if you love your job. Come join us on the gravy train!
*This makes little sense when the average life expectancy is just under 79, but screw it.