Finding The Path to Financial Freedom
If you’re looking to prepare for your financial future and have an interest in finding the path to financial freedom, this post is for you.
See, the way most people earn a living is to trade their time for money.
The challenge, even if you are a highly paid professional like an attorney or surgeon, is that there are only so many hours in the day, week, month and year that you can trade your time for money – and there is a ceiling to what people are willing or able to pay.
This is why the majority of people who are employed or even self-employed are stuck on a financial treadmill often referred to as the rat race. See, the problem is that if you stop walking on that treadmill (i.e. trading your time for money, as an example, if you are sick), the money stops.
CREATE INVESTMENTS RATHER THAN A CAREER
The solution to getting off this financial treadmill is to build assets and leverage those assets so that your money is working for you, rather than you having to work for it.
Interestingly, self-made millionaires tend to teach their children not to focus on short term benefit (i.e. monthly salary) but to invest their time and resources into building assets that will mature and provide time and time again in perpetuity.
USE THE POWER OF LEVERAGE
Think of financial leverage this way. An author writes a book and makes $1 per book sale. They may have spent a significant amount of time writing that book, but once it’s published, it’s done – they are no longer swapping their time for money – they have an asset they can leverage time and time again.
Whether the book goes on to sell 100 copies or 100,000 – the income derived from the initial effort required to create this asset will be generated without them having to be physically present and swapping their time for money; hypothetically, they could be making money in their sleep – particularly if the book were to be selling internationally on a platform such as Amazon. Indeed, they could be lying on a beach in Hawaii!
A further analogy is that of a musician; they put a lot of effort into creating an asset in the form of a song that is then leveraged time and time again. If an advertiser, for example, wants to use their song they would have to licence the asset in order to use it for their advert – meaning, in broad terms, that each time the advert aired the artist that created the song would be paid!
This is where most people make the mistake; they are simply going to a job, and trading their time for money, rather than build assets that generate long-term income; like a fruit tree that bears fruit each year, just with a little watering and maintenance on your part.
When you shift your mindset from that of trading time for money, and instead, focus on building assets – you start walking the path that leads toward financial freedom!
DISPELLING A COMMON MYTH
You’ve probably heard the myth that you ‘need money to make money’ particularly when it comes to investing or creating assets. If you plan to buy a few houses in order to generate rental income from tenants, then yes, that would probably be true – but thanks to the internet, today, someone with hardly any money, credit rating, or access to resources can become financially free. Afterall, how much money did JK Rowling have when she wrote the first Harry Potter book?
It’s important to do your homework, as there are a number of applications and platforms that can help mitigate this risk. It might be worth checking out a betterment review in order to see if this is something that might be helpful in helping you invest wisely rather than blindly.
The great news is that today, whether you’re interested in trading on the stock market or setting up a money making blog, there’s so much information and education that we can gain access to via the internet at such ease and low cost. If you’re looking to find the path to financial freedom, then you need to stop thinking in terms of earning a salary and start thinking more about building assets and investments.