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What is Financial Freedom?
FF is a stage in your financial journey of life where your Passive Income exceeds your living expenses. In other words, you don’t need to pursue active job to afford your expenses.
What is Financial Freedom?
FF is a stage in your financial journey of life where your Passive Income exceeds your living expenses. In other words, you don’t need to pursue active job to afford your expenses.
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“Financial Freedom is the ability to quit your job so that u never have to work again”.
-Van K Tharp
“Financial Freedom is the ability to quit your job so that u never have to work again”.
-Van K Tharp
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FF is often mistaken as being rich which is a wrong perception. FF doesn’t mean that u have all the money in the world. It doesn’t mean that you are so extremely wealthy that in spite of all your foolish financial habits u won’t have to work.
FF is often mistaken as being rich which is a wrong perception. FF doesn’t mean that u have all the money in the world. It doesn’t mean that you are so extremely wealthy that in spite of all your foolish financial habits u won’t have to work.
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FF is a stage where u don’t have to worry for your monthly expenses even if u don’t have monthly incoming salary because u have created passive income streams which will provide for them.
FF is a stage where u don’t have to worry for your monthly expenses even if u don’t have monthly incoming salary because u have created passive income streams which will provide for them.
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One more misconception is that people who have achieved FF don’t need to work. In fact, financially free people are busier with their work for which they are extremely passionate.
This fact I can say based on my own personal experience.
One more misconception is that people who have achieved FF don’t need to work. In fact, financially free people are busier with their work for which they are extremely passionate.
This fact I can say based on my own personal experience.
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The bye-product of achieving FF is spending your time as per your wish rather than the employer’s wish. U have full control over your time & its u who will decide what u want to do in the next hour.
The bye-product of achieving FF is spending your time as per your wish rather than the employer’s wish. U have full control over your time & its u who will decide what u want to do in the next hour.
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FF can be achieved even if u don’t have huge bank balance.
Fascinating but true!
Suppose your monthly expenses are Rs 50K. If you have cash flows exceeding Rs 50K from your passive income streams, u r supposed to have reached FF stage.
FF can be achieved even if u don’t have huge bank balance.
Fascinating but true!
Suppose your monthly expenses are Rs 50K. If you have cash flows exceeding Rs 50K from your passive income streams, u r supposed to have reached FF stage.
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Let me present an objective approach to Financial Freedom based on Mathematics.
To start the process of achieving FF, it’s important to know about your Financial Freedom Number.
Let me present an objective approach to Financial Freedom based on Mathematics.
To start the process of achieving FF, it’s important to know about your Financial Freedom Number.
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What is this FF number?
It is simply the difference b/w your passive income & monthly expenses. If this number is 0 or more it means your passive income is able to afford your expenses & you are now Financially Free!
Congratulations are in order!!!
What is this FF number?
It is simply the difference b/w your passive income & monthly expenses. If this number is 0 or more it means your passive income is able to afford your expenses & you are now Financially Free!
Congratulations are in order!!!
11/
Suppose,
Your monthly expense = Rs 50K
Passive income from all the passive avenues = Rs 10K
FF number = 10 - 50 = - 40
So, you are 40K far from achieving your FF. Purpose is to bring this number to 0 or greater to achieve the FF stage.
Suppose,
Your monthly expense = Rs 50K
Passive income from all the passive avenues = Rs 10K
FF number = 10 - 50 = - 40
So, you are 40K far from achieving your FF. Purpose is to bring this number to 0 or greater to achieve the FF stage.
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This way of thinking was developed by Van K Thorpe in his masterpiece book “Safe Strategies for Financial Freedom” which I highly recommend everyone to read at least once.
This way of thinking was developed by Van K Thorpe in his masterpiece book “Safe Strategies for Financial Freedom” which I highly recommend everyone to read at least once.
13/
To summarise, to calculate your personal FF no-
1. Calculate your total monthly expenses.
2. Calculate your passive income u make on an average each month.
3. Subtract expenses from income.
If no is -ve make efforts to bring it to 0 or +ve.
To summarise, to calculate your personal FF no-
1. Calculate your total monthly expenses.
2. Calculate your passive income u make on an average each month.
3. Subtract expenses from income.
If no is -ve make efforts to bring it to 0 or +ve.
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So here, as we can see there are 2 steps for achieving FF.
1.Increase your passive income
2.Reduce your expenses.
One has to work on both the fronts to shorten the journey of achieving FF.
So here, as we can see there are 2 steps for achieving FF.
1.Increase your passive income
2.Reduce your expenses.
One has to work on both the fronts to shorten the journey of achieving FF.
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I shall cover more on passive income & its streams in forthcoming threads. Stay tuned.
That’s all for this thread.
If u found it useful retweet for wider audience.
Thank you!
I shall cover more on passive income & its streams in forthcoming threads. Stay tuned.
That’s all for this thread.
If u found it useful retweet for wider audience.
Thank you!
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