I’ve referred it so many different things in various posts. Financial solvency, financial independence, financial freedom. The idea behind these phrases is to no longer allow money to have control over your life.
The majority of these ideas came from Mr. Joshua Sheats.
When you no longer are dependent on steady income from your job you can start making decisions with greater positive impact on you and the world.
Job Independence
I don’t recall who coined this term but I really like it… FU money. Which is, Fuck-You money. It’s money that gives you the freedom to walk away from something that insults what you stand for.
It’s similar to your emergency fund – giving you the runway to live without an income.
Being financially free, you no longer have to make your decisions based on your dependence on your job income. You can walk away instead of sitting there and moping or complaining.
If you’re a family of 4, have your home paid off, have enough money saved up which you can live off of for a few years or, even better, have passive income from your investments that could sustain a basic lifestyle for you then you will be in a position to make more effective decisions.
Creating New Opportunities
A sound decision, a healthy decision that doesn’t pollute the world with negativity, is one few of us have the luxury to make.
Many of us went into medicine to do international work or work with underserved populations. With financial freedom these and many other options are available to us.
Maybe medicine is no longer your calling… maybe foster children or animal welfare is where your heart is at now.
Reaching Financial Freedom
There are 2 ways of reaching financial freedom. The common way is to work your ass off, stress yourself and others around you, put your family and friends on hold for the first few decades of your life in order to accumulate massive amounts of wealth.
In that process, you will also get accustomed to spending a lot of money in order to distract yourself from the stressful life that you have lived.
The second option is what I think is more sustainable. It’s learning to live on a lot less. Differentiating between wants and needs and developing a healthy and sustainable financial plan.
- moving to a lower cost area
- decreasing your living expenses
- investing in passive income options
- accumulating savings early in your career
- avoiding debt
Saving early in your career is very powerful. Living in a lower-cost state doesn’t mean you have to relocate to an area that you are completely miserable living in.
Understanding that there are many other options out there than California vs not-California is important.
Your happiness should not be tied to your expenses. True, there is a fine line of comfort and luxury but remember that many families live on $30k of income and raise wonderful children, add positive energy to the world and live a life of peace and joy.
Dependence on a High Income
As physicians we have become increasingly dependent on a high salary. Many of us have learned to spend according to what we make and not what we need.
This has led to unhappiness and feeling unfulfilled. Furthermore, we have developed a fear of what if there isn’t enough money. I propose developing a solid plan of financial independence and I believe it will open doors that you’ve never dreamed of.