Generate money automatically and have time? These are the stages of financial freedom

Financial freedom is a concept that can be related to having a lot of money or enough to ditch the routine, stop working and enjoy a well-deserved vacation.

However, to have financial freedom it is not necessary for the person’s bank account to have a large amount of money saved because it is essentially about establishing an established personal finance system that allows us to meet the daily needs in the present and future. future.

This type of independence is then defined, according to El Economista, as the economic condition in which people no longer have to worry about money in order to live their lives normally. If it were limited to being a millionaire, it would be wrong.

The Seven Stages of Financial Freedom

Provide clarity

This is the turning point when a person starts looking for ways to gain financial freedom. In it, the person usually wonders about his place financially and considers where he wants to be.

This stage can also be identified as dependency, which is when finances depend on other people such as parents, insurance and pensions for everyone.

Solvency

At this stage, the person is solvent or self-sufficient, so he or she can meet their financial obligations without having to turn to third parties or incur debt. Here you review your expenses, try to save on services and, if possible, start investing.

How to accidentally get back money deposited into another account

Savings

This is when the person commits to saving. You don’t need to earn more money than usual, but you do need to know how to manage it better to work toward future goals.

Stability

At this point the person is freed from stress about money. Of course I always have to think about him, but in a different way, because it is no longer a worry.

So much so that the possibility of losing your job is no longer terrifying because you have backup savings.

Flexibility

At this stage, a minimum of two years of financial freedom can be added, with the lifestyle fully covered by the assets.

The person here can now think about the possibility of voluntarily changing jobs or taking a sabbatical year.

Financial independence

At this point, work is no longer necessary to cover a lifestyle. Well, the income generated from savings and the rest of the sources of passive income will take care of that.

Abundance

People who manage to reach this point are no longer dependent on work for a living. Furthermore, they can live as they want, without worrying about money or market movements.

(JO)