Ronit, a 36-year-old sales consultant, earns Rs. 45,000 monthly. His expenses amount to Rs. 20,000 each month, and he spends the rest of it partying at expensive places. So, after every two months, he finds himself borrowing money from his friends to pay his credit card bills.
Recently, he had to renovate his home, which needed major repairs. His friends refused to lend him money. So, he was left with no option but to apply for loans like Axis Bank Personal Loan. If Ronit had achieved financial independence by saving and investing regularly, he wouldn’t need to beg his friends for money. He would have easily afforded home renovation and gone for more expensive improvements without worries.
The unfortunate thing is that this situation is quite common. An absence of the knowledge of financial independence prevents many from allocating their monetary resources wisely. But you shouldn’t keep yourself elusive. Let’s understand why financial independence is crucial in helping you live a great life.
Hit Every Curveball That Life Throws on Your Way
We aren’t sure about many things in life. But one thing we are sure about is change. No matter how disciplined you are, when life throws curveballs, you won’t say, “Can handle it easily.’’ Uncertainties like job loss, medical emergencies, and economic downturns are something that no one is totally immune against.
However, when you are financially independent, you can navigate the above situations without letting them snatch your sanity. You will have adequate money in your account, no debt to pay or EMIs to complete. Besides yourself, you can also help your near and dear ones when life throws curveballs. You won’t need to borrow money or stress out about medical expenses when someone near to you gets ill.
Live Life Uncaged, on Your Own Terms
Passion vs. money. This is the constant battle people face when financial independence is elusive. You may take up jobs that provide quick and timely money instead of those that give you genuine pleasure. On the other hand, it doesn’t matter how much a role pays when you’re financially free.
You can freely pursue your passion. You will have enough passive income so you can dive into projects that feel personally fulfilling. Whether it’s travelling, volunteering or charity, you are free to choose what your heart desires.
Retire Early But Keep Your Lifestyle Lavish
You may have seen your elders retiring after spending decades on their jobs. But that shouldn’t make you feel as if you’re doomed to the same fate.
A survey by IRIS 4.0 on Moneycontrol.com found that 93% of people over 50 regretted delaying their retirement planning. So, if you have money streaming through stocks and mutual funds, your retirement can happen way earlier.
What’s more, you don’t need to worry about the difference between your pre and post-retirement lifestyle. The only difference will be the absence of stress and anxiety associated with 9 to 5. Do you know that an investor’s premium for an early retirement plan is fully eligible for tax benefits? You can even diversify your tax payment with such a plan!
Remove the Word ‘Over Pampering’ from Your Dictionary
Money guilt is real. When you are getting your finances in check, splurging on what you like feels like a distant dream. Even if you do purchase something expensive or ‘high-end,’ the guilt that comes with it is omnipresent.
Contrarily, the financially independent you can do so much guilt-free. Whether it’s buying tickets to go abroad or attending a happening concert, the options are plenty. Put simply, there is no such thing as ‘over pampering’ in your life once you attain freedom from money matters. You can try out things that give you momentary happiness. No need to fix your sight on only that which is a necessity.
Conclusion
Financial independence gives you a stress-free life where you can create abundant memories. It helps you tackle big and small challenges, help others, and chase your passions in full force. You become the creator of a delightful journey on which you have complete control. A life defined by the absence of dependence on anyone for anything is indeed something to aspire for.
FAQs
- What is the 4% rule for attaining financial independence?
The 4% rule for financial freedom relates to retirement spending. It involves withdrawing and using just 4% of your total investments. This should be done in the first year of retirement. Its advantage is that your overall money will outlast you throughout your retirement.
- What are the fundamentals of achieving financial freedom?
In order to achieve financial freedom, you should have a good view of your financial situation. Ensure to create a budget and never spend more than you earn. After that, try to generate passive sources of income by investing in stocks and bonds. It’s also essential to save your income and create an emergency fund.
- Why is financial independence crucial for women?
Financial independence is important for women because it gives them greater autonomy and confidence. This autonomy helps women to make decisions that align with their genuine interests. They don’t need to rely on their family members to do things they feel strongly about.
- Why does being financially independent feel hard?
Being financially independent seems challenging because it needs you to get out of your comfort zone. You need to live below your means for a long time to save and minimize your expenses. You also need to stick to a budget and take proactive steps to eliminate debt. Besides, you need to analyze your investments, diversify your portfolio, and find those avenues that give you maximum returns.
