What is Financial Freedom?

To me financial freedom is the ability to live life the way you want without the stress that typically comes along with finances; to have a pile of cash or a passive stream of income that can support you indefinitely into the future and cover any unforeseen expenses. You should be able to travel, play golf, go out for meals, send your kids to college, spend time with your family, shop, or just stay at home gardening with your dog. Whatever your ideal life is, you should be able to do it without the stress and headaches of wondering if your paychecks will one day stop or if you will outlive your savings.

Everybody’s dream lives are different, therefor the amount of money it takes to be financially free also varies. The amount of money you need also depends on how savvy of an investor you are. Let’s run some numbers based on my situation as an example. If you know me you know that I don’t care for flashy things, don’t go out very often, don’t have any debt, and am pretty good with money. We live in a small historic craftsman house in Salem, OR and enjoy traveling. Our yearly budget is approximately $65,000. I am 35 and hope to live to at least 90.

Here’s what it will take to be financially free:

Ultra Conservative/ Pile of Cash

Assume that with a certificate of deposit you can cover the cost of inflation.
55 years x $65,000 = $3,575,000 to be financially secure/ free
$0 left

Savvy Investor

Assume that after factoring in inflation and taxes, you can achieve a 7% return.
$65,000 / 7% = $928,571 to be financially secure/ free
More than $1.8 million left to pass along or donate

I know you may have a higher yearly budget, but the math still works the same. The only two factors that you have control over are your yearly budget and the return on your money. With the willingness to study and learn you can very easily jump from the first scenario to the second without having to compromise your lifestyle.

My goal is to help as many people as I can create their own level of financial freedom to add happiness to their lives; from creating just that extra bit of income so you aren’t living paycheck to paycheck all the way to flying your private jet to your tropical Island getaway.

I’d love to hear about your ideal future and help anyway I can. Schedule a call today.

Happy Investing,

J. Eric Gillem