The Less-Traveled Road to Financial Freedom

The Fourth of July is an exciting holiday that marks the independence of our nation with the signing of the Declaration of Independence. Little known fact...did you know that the Continental Congress declared freedom from Great Britain on July 2, 1776 when it voted to approve a resolution for the colonies to be free and independent with no allegiance to Great Britain? They then had to draft a document explaining what this meant to the public and it took two days to agree on the edits. 

Achieving financial freedom or independence is a goal nearly everyone has. Many associate it with having the financial means to do what you want or even retire early. In fact, the FIRE (Financial Independence, Retire Early) movement has gained popularity in recent decades sparked by the best-selling book Your Money or Your Life by Vicki Robin and Joe Dominguez. The idea here is to save the majority of your annual income, retire far earlier than the traditional retirement age of 65, and live off of small withdrawals from your savings and investments. We're going to further explore what financial freedom is, the progression to intentionally living your values, and how this can change your life and the lives of others.

What is Financial Freedom? 

Some might say financial freedom is not getting financially stressed out when there is an unexpected expense while others would say it's being able to pursue items on their bucket list without financial worries. Is it a number? Try Googling "what's your retirement number" and you'll find countless articles about the importance of finding your magical retirement number. Or is financial freedom a mindset? There are many families with significant wealth who have more assets than they'll every need during their lifetime and still worry about having enough. 

To fully experience financial freedom, there is a degree of financial wellbeing. Nonetheless, there's also a mindset and conviction in living an intentional life according to what you value. If you're stuck in the rat race, keeping up with the Jones's, and imprisoned by a lifestyle that is beyond your means, is that freedom? This does not seem to be a values-driven, intentional way of life. If we can be good stewards of all that we're blessed with, the real freedom is in being content in life and having the clarity and conviction to live your values. 

Be a Good Steward

We all have a finite amount of resources to live our lives, and we need to have a plan for how to make the most of these resources. Even Jesus himself in the Gospel of Luke uses the metaphor of building a tower, sitting down first to count the cost of materials, and making sure there's enough money to complete the project. It would be foolish to run out of money before the building could be completed, just as it would to prematurely deplete your financial assets due to lack of planning. Good financial planning is proactive, comprehensive, and ongoing--all the way until the completion of your life.   

Good stewards tend to do the following:

• Live below their means
• Minimize or avoid lifestyle creep after financial windfalls or increases in income
• Believe financial freedom is more important than status
• Keep homes and cars for a long time
• Invest wisely and with discipline
• Hire smart help such as financial advisors, CPAs, and attorneys

As you build financial wealth, it becomes increasingly important to gain clarity about what you value so that decisions are intentional and you're on the path to live a fulfilling life. 

Become Clear About What's Important to You

If you're not careful, you can end up feeling like life is controlling you. Some describe it like running on a hamster wheel, falling into a trap of routine without intentionality. Roy E. Disney of Walt Disney once said, 

"When your values are clear to you, making decisions becomes easier."

– ROY E. DISNEY OF WALT DISNEY

What do you value? I once heard a story about a women who was upset about not being able to travel because she was always taking care of her elderly mother. She was asked why she wouldn't just hire a caretaker and go travel as she wanted. She thought about it and replied that her mother has done so much for her and she wants to be the one to take care of her mom. It was a way of expressing her love and appreciation for all her mom had done for her. Once she realized this, she was able to care for her mom with a greater joy and sense of peace about delaying her dreams of travel. Her mom was more important and she knew her time was limited. 

Once we know what we value and what our priorities are, we can make intentional decisions. You don't want to look back on your life and regret spending too little time with your spouse or children, not taking that family trip you always wanted to, not giving more to charity, among other things. So take action now! Give yourself some time and a quiet space to think through what's important to you. It's amazing what people do with their lives when faced with mortality. Survivors of cancer, accidents, or other traumatic events often have much greater clarity and go on to make life altering decisions. Imagine your own mortality. What changes might you consider with only so much time to live? What regrets would you have if you knew today was your last day? 

Align Your Resources With Your Values

After you understand what your values and priorities are in life, compare this with how you actually spend your time and money. Management guru, Peter Drucker, once said,

"Tell me what you value and I might believe you, but show me your calendar and your bank statement, and I'll show you what you really value." 

– PETER DRUCKER

Aligning your capital with your values can help you reduce or eliminate certain spending and ultimately redirect resources to what is most important to you. This helps you to live a more intentional life. 

The Power of Combining Financial Freedom With Intentional Living

Imagine feeling peace of mind knowing you have a financial plan you're continuously revisiting and you're on track to meet your goals. You're content in life and you have clarity of what you value and are living intentionally. We have seen this combination of financial freedom and intentional living lead to incredible life decisions such as:

• Resign from a corporate job to start a business
• Spend more time with family and friends
• Substantially increase charitable giving
• Fund education for grandchildren

What could it mean for you? If stewardship is important to you and you try to make wise financial decisions, there's a good chance you'll achieve some level of financial freedom. Many will stop there and unfortunately miss an opportunity to really live intentionally. If you can do both, you have a real opportunity to live your best life and make the world a better place. 

Journey Beyond Wealth (“JBW”) is an Investment Advisor registered with the SEC. All views, expressions, and opinions included in this communication are subject to change. Registration of an investment advisor does not imply a certain level of skill or training. This communication is not intended as an offer or solicitation to buy, hold or sell any financial instrument or investment advisory services. Any information provided has been obtained from sources considered reliable, but we do not guarantee the accuracy, or the completeness of, any description of securities, markets or developments mentioned. We may, from time to time, have a position in the securities mentioned and may execute transactions that may not be consistent with this communication's conclusions. Past performance does not guarantee future performance. Future returns may be lower or higher. Investments involve risk. Investment values will fluctuate with market conditions, and security positions, when sold, may be worth less or more than their original cost. Please contact us if there is any change in your financial situation, needs, goals or objectives, or if you wish to initiate any restrictions on the management of the account or modify existing restrictions.