Achieving financial freedom is a goal that resonates with many, but the concept of distilling it down to a single number might seem too simplistic. Yet, it is precisely this simplicity that makes the pursuit of financial freedom more tangible and achievable. In this blog post, we will delve into the idea of finding your Financial Freedom Number—a numerical representation of the income needed to live life on your terms.
The Financial Freedom Number
Your Financial Freedom Number is basically the amount of funds you need each month to pay the bills and live life the way you want, all without being chained to a 9-to-5 job. For regular folks in the middle-class lane, this magic number usually falls between $5,000 and $7,000 monthly. It’s not about living like a rockstar; it’s about having the freedom to cover your basics and still have a bit left over for fun. So, whether it’s your rent or mortgage, utility bills, groceries, or your car payment—add it all up, and that’s your target. Once you hit this number consistently, you’ve hit the sweet spot of financial independence, where you call the shots in your own life.
Calculating Your Financial Freedom Number
Calculating your Financial Freedom Number is simpler than it sounds. Just add up the everyday things you need to pay for, like your rent or mortgage, utility bills, car payments, loans, groceries, entertainment and other regular costs. It might seem like a big, scary number at first, but don’t worry; it’s not there to freak you out. Instead, think of it as a bullseye—a clear target to aim for, so you can wave goodbye to your W2 job while still maintaining the life that you want to live.
The Five Ladder Steps to Financial Freedom
To embark on the journey towards your Financial Freedom Number, it’s crucial to adopt a mindset that aligns with your goals. Renowned speaker and mindset coach, Tony Robbins, outlines five ladder steps to financial freedom. These steps not only provide a roadmap, but also offer milestones to strive for along the way.
Financial Security: Establish a financial safety net that covers three to six months of living expenses. This creates a buffer against unexpected events and allows you to focus on long-term goals.
Financial Vitality: This stage involves eliminating high-interest debts and building a solid financial foundation. By reducing debt, you free up more resources to invest and grow your wealth.
Financial Independence: Achieve a level of passive income that covers your basic living expenses. This milestone marks a significant step toward breaking free from the constraints of a traditional job.
Financial Freedom: Attain the ability to fund your desired lifestyle without actively working. This stage offers the flexibility to pursue passion projects and engage in activities that bring fulfillment.
Financial Absolute Freedom: Reach the pinnacle where your wealth is not only self-sustaining but also allows you to make a significant impact through charitable contributions or other philanthropic endeavors.
Figuring out your Freedom Number is more than just playing with a calculator—it’s like sketching the blueprint for a life where you call the shots. It’s about adding up what you need to live your current life without being tied to a 9-to-5 job. Yes, the number might seem like a puzzle at first, but think of it as a part of your journey to freedom. Once you wrap your head around these steps, you’re not just crunching numbers; you’re creating a roadmap to financial freedom that’s as unique as you are. Take that first step today, punch in those digits, and watch as you start crafting the life you’ve always pictured in your dreams.
Remember, your Financial Freedom Number isn’t just a number; it’s the gateway to a life where you take the reins and set your course. Don’t merely dream about it—initiate the journey today to discover your freedom number and embark on your journey toward a life that you deserve.