Secrets of the Financially Independent


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As a professional accountant, I’ve seen up close what sets the financially independent apart, and I’m thrilled to share these secrets with you. So, let’s roll up our sleeves and dive in!

1. They Start with a Vision

Financial independence starts with a clear vision. It’s not just about money; it’s about what that money will allow you to do. I once had a client, let’s call her Emily, who envisioned a life where she could travel at will without financial worry. That vision became her guiding star, and every financial decision was a step towards that goal.

2. They Understand Money is a Tool

The financially independent see money as a tool, not a goal in itself. Money is the means to build the life they want. I’ve worked with self-employed clients who’ve created passive income streams, so their money works for them, freeing them up to pursue their passions.

3. They Live Below Their Means

This might be the most powerful secret. Living below your means isn’t about penny-pinching; it’s about creating space between what you earn and what you spend. This gap is where financial independence is born. I’ve witnessed clients go from living pay check to pay check to financially independent by making this principle their mantra.

4. They Make Savings a Priority

For the financially independent, saving isn’t something that just happens if there’s money left over at the end of the month. It’s non-negotiable. It’s the bill they pay first – to themselves. A friend of mine started by saving just 10% of her income; now she saves 50% and lives on the rest, quite comfortably.

5. They Invest Wisely

Investing is not a game of luck for the financially independent; it’s a strategy. They understand the markets they invest in, they diversify, and they play the long game. Smart investing doesn’t require a hefty sum to start, just a hefty commitment to keep going.

Financially Independent: They Educate Themselves

Continuous education is a habit of the financially independent. They read books, and stay updated on financial trends. This self-education pays dividends, literally and figuratively.

6. They Avoid Debt Like the Plague

Debt is the antithesis of financial independence. The financially independent use debt strategically, if at all. Credit cards for points? Sure, but only if they can pay the balance in full each month. Mortgages? Perhaps, if it’s part of a larger investment strategy. A large mortgage on your personal home should be out of the question.

7. They Understand the Power of Additional Income Streams

The financially independent often have more than one source of income. Whether it’s rental income, a side hustle, or dividends from investments, they don’t rely solely on a pay check. This diversification of income is like a safety net, ensuring they’re not dependent on any single source.

8. They Plan for the Future

Long-term planning is a non-negotiable aspect of being financially independent. Superannuation accounts, investment portfolios, and even estate planning are all part of the mix. They set goals, review them regularly, and adjust as needed.

Financially Independent But Not Fearless

Becoming financially independent doesn’t mean you’re fearless. It means you’ve learned to make decisions based on information, not emotion. Fear can be a powerful motivator, but for the financially independent, it’s not the decision-maker.

Becoming financially independent is within reach. It’s not about making a fortune overnight; it’s about making wise choices over time. It’s about commitment, education, and a clear understanding of your own financial landscape.

So, take these secrets to heart. Reflect on them, work them into your life, and watch as the doors to financial independence swing wide open.

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