Intro to Financial Independence

Let me start out by telling you how I achieved financial independence at the rip age of 33, on accident. Most people don't like stories about making good financial decisions and arriving to a goal on accident. However, my story is exactly that. I knew that I was working towards a financial goal but I didn't know that it was labeled "financial freedom". I spent a decade in a single parent and sole provider role in my unique family dynamic. 

My greatest fear as a single parent was something financially impairing coming up unexpectedly and not having the security or safety to navigate it because I was relying on one income and the majority of the parenting responsibilities. I knew that though I had a stable career, I wanted to create additional income streams so that it would at least seem like I had a partner contributing to my long term financial outlook, even if that was just ME showing up for us in another way. 

As we prepare for our special guest Diania Merriam, the founder of EconoMe, a wonderful conference for people seeking their own financial independence, we are going to learn the basics of the FI movement or lifestyle.

Financial independence, or FI, is not just a word, but a whole lifestyle and movement dedicated to helping individuals achieve true financial freedom. It's like a delicious pie, but with so much more sweetness! Within the realm of FI, there are different levels to strive for, such as the FIRE movement, which stands for financial independence retire early.

As a business owner, you might feel that financial independence is a distant dream, but let me assure you, it's not as complicated as it may seem. Before we dive deeper into the content, let's first define these labels. According to Wikipedia, financial independence is a state of financial well-being where an individual or household has accumulated enough financial resources to cover all living expenses without relying on active employment to maintain their current lifestyle.

FIRE, on the other hand, is all about achieving this goal as early as possible in life. Many FIRE achievers retire in their 30s or 40s, which is truly remarkable. What I've discovered within the financial independence community is that with the right goals in place, even those who start later in life can achieve FI surprisingly quickly.

So, why do people pursue the financial independence movement and set FI goals? Well, it's all about freedom and flexibility. FI grants individuals the freedom to pursue their passions, the flexibility to do work that truly matters to them, and the ability to live a life filled with enjoyment rather than obligation. It also provides a sense of security and stability, allowing people to take risks and reach seemingly impossible goals.

However, it's important to acknowledge that there are reasons why some people resist setting FI goals. Fear plays a significant role in this resistance. Common fears include the fear of failure, fear of success, fear of judgment, fear of change, fear of risk, fear of the unknown, and fear of disrupting the status quo. Overcoming these fears is crucial in embarking on the journey towards financial independence.

Now, let's talk about how most people get started on their path to financial independence. The first step is to get out of debt. The debt snowball method, popularized by Dave Ramsey, is a common system that helps individuals eliminate financial debt. Once debt is under control, the next step is to budget household expenses and aim to save a quarter to half of the household income.

Creating a side hustle or finding additional sources of income is another effective way to bridge the income-to-savings gap. Once you have established a system to grow this gap, you can start building your financial independence plan. This plan may include generating passive income, income from side hustles, inheritance, pension and retirement income sources, and various other sources.

In conclusion, financial independence is not just a dream, but an achievable reality. By embracing the financial independence movement and setting FI goals, you can unlock a life filled with freedom, flexibility, and the ability to pursue your passions. Don't let fear hold you back; take the first steps towards financial independence today!