9 Levels Of Financial Freedom For 2021
What Is Financial Freedom?
It’s about taking ownership of your finances so that you have a reasonable cash flow that lets you live comfortably, without worrying about bills and sudden expenses.
Becoming A Salaried Professional
This is when you start making your own money and decide how you want to spend it.
You are earning, and have funds to spend on more than just bills and essentials.
Quitting Your Job
So your job was toxic, and you chose to make a quick exit - because you have saved up to tide you over for a while.
And, in 3-4 months, you’ve found yourself a new job!
This is the level where you have so much saved up, that you can afford to take a year-long sabbatical, without feeling the pinch and worrying about rent/EMI/bills.
The Passion Project
This is the stage where you have saved enough to take a year or two off and pursue a passion/launch your own startup, without having to worry about covering basic expenses.
This is one of the keys to financial freedom. At this stage, you are debt-free and have paid off whatever loans you accumulated previously.
Getting Set For Early Retirement
This is the stage where you start thinking of how much you need to save and invest so that you can quit your job ahead of time and get by without a steady income.
This is the time where you can take the plunge and quit your job for good on the date you have decided- because you have enough funds and don’t need to save and invest anymore!
You Can Quit Your Job Now
This is the sweet spot - you have the option of giving up a monthly salary because the investments you have made will see you through for the rest of your life!
You Have More Than You Need!
This is the dream - you can quit your job, live well off your investments + savings, and STILL have enough left over to fund a passion project, charity, travel etc.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.