What is "Financially Free"?

[jmjj215]

Let's discuss financial freedom. How does one attain it? When do you know you have it? Does anyone here have it already? How do you define it?

[BillsGirl]

I would say my husband and I have as close as you can probably get now days.... asode from out cars needing to be paid off and at any time we can sell one and with the profit pay off the other, our credit card debt is so low we have ample in our savings to pay it off if need be!

[meaghanchan]

I would define financial freedom for myself as being the point where my passive income (investment returns from a fairly predictable source) exceeds my expenses. I'm nowhere near that point yet!

When I get to that point (if it ever happens) I will no longer have to work for money. I could choose where to work, what to do, and if to work at all. I could spend all my time volunteering, or working on projects I saw fit. I wouldn't have to worry about losing my job.

That, to me, is financial freedom.

[Russell]

Meaghan summed it up quite well.

Financial freedom to me is when I don't have to work to maintain the lifestyle I want. Nope, I'm not anywhere even close to it...

[jmjj215]

So one defintion:

Passive Income from a reliable source > lifestyle supporting expenses

Sound good?

[Tree0164]

Financial freedom to me is being able not to work and having my investments and passive income generate enough money.

[BAGAGT1]

To me, Financial Freedom is not having to worry (too much) about money. That doesn't mean I don't have to work, but it does mean that I don't have to worry about losing my job. I haven't achieved it yet.

[Fern]

Financial freedom means being free of money-related anxiety or worry.

It also means you have many options open to you when it comes to making decisions about how to spend your money or spend your time because the answers are not dictated by financial concerns.

Financial freedom means taking all the time and effort you used to apply to saving a buck here or there and applying it to more meaningful pursuits.

So, in summary, financial freedom = more options/less worries/more time for other stuff.

[sweeps]

What if financial freedom isn't about accumulating enough income/assets to be able to make the choices we want, but instead about wanting less. (In other words, lowering the bottom line instead of raising the top line.)

One could argue that a homeless person is financially free if he is satisfied living in a cardboard box and eating food from a dumpster. He doesn't have to worry about earning money, saving money or making any other financial choices.

At the same time, one could argue that Bill Gates is not financially free. His entire day is dictated by how he's going to buy, sell, spend, save, invest, and donate. His activities affect millions of people, so he must be very deliberate in his financial decision-making.

[cercis]

Sweeps - I think it is a function of both. You do need to have enough money to provide medical care when necessary. The homeless person may be happy now, but in a few years, he will need medicine, etc in order to live a painfree life.

But, one way to have that money is to reduce our wants. I've done that pretty well, the next thing I need to cut is the eating out and curb my need to provide "things" for my kids.

[jmjj215]

If financial freedom only means not having to worry about money - why don't we just train ourselves to not worry about money as much? Stop reading about it, visiting forums, etc.

[sweeps]

I agree with you guys. Just trying to stir up some debate.

[DivaJen]

I like the passie income to support the lifestyle idea. I also like the idea of lowering one's "bottom line". If you want less and can live on less, then the amount of passive income you need will also be less.

We are not financially free yet, and I don't expect to be for at least 15-20 years. But worrying about money now means that we are actively working towards the goal of freedom.

[debtfreeme]

right now, being out of debt.

i am sure that in the future it would change.

I would like my investments to be better and making more money and to have a house paid off too.

[JBinKC]

Unfortunately, you are never financially free a chronic health problem can easily bankrupt a person.

[jmjj215]

We're probably getting more into the "worry-free" impossibility. We'll never be worry-free. Even with tons of money, you'd still worry. Bleh.

[Firefly]

I think financially free would be when all your cars, house and all is completely paid off and having no debt.

[elcheapo]

living the life you love