What is Financial Freedom

What is Financial Freedom - Many people are now obsessed with the term financial freedom. Many concepts offers financial freedom. Finally people are obsessed to retire early. Whether it is financial freedom? How can we go beyond a condition called as financially free? What measures are needed for that? Those questions will we discuss together.

Robert t. Kiyosaki in his book Rich Dad, Poor Dad wrote that financial independence is achieved if wealth grows automatically above inflation even though the person is not working anymore. How to achieve those conditions, a lot of Multi Level Marketing (MLM) which offers a unlimited amount of income if its distributors conduct business consistently in the MLM. So the focus of MLM is to give financial independence through an unlimited income.

The next question is whether the huge revenues, distributors who successfully can be said to be financially free. From observations from some of the top distributor of an MLM, some of them apparently do not know how to manage finances. Buy a property boom anymore but they actually do not know what is the purpose of the purchase. If the purchase was done with investment motives or will be used on its own. So in fact they can generate huge revenues, but they don't know how they manage their finances.

Let's look at a concept others in seeing the term financial freedom. In the world of financial planning or in the world known as financial planning, financial freedom is free from debt, have fixed income, children have graduated high school, and cash on hand anyway. So at some point, someone is said to be financially free if all the indicators have been exceeded or have planned financially at the beginning will be exceeded.

As we know that the world is increasingly shared individually, i.e. intergenerational dependency are increasingly not subject to each other financially. Generations of our children and the next generation will not want to bear the brunt of the life his parents or his grandfather or grandmother generations earlier. But the cost to the lives of people who are already quite large, ranging from the cost of health care that is increasingly high, the cost of the necessary nurses to funeral expenses are also considerable.

On the other hand the child is in need of a condition so that he can live independently. Can generate its own money for the cost of his life right now and saving for future needs. The son of independence at first like the growth of shoots of plants is still very fragile, exposed to wind which still only shoots it could even sway a cut out of the ground with its roots. With the growing strength of the root and stem, this plant will be the stronger wind and any kind of fast wind will not be bounced it. illustrates how fragile a newborn child. If these children should already be saddled with the burden of his parents or of previous generations, then as the shoots burdened with various Binder, then the plant will keep growing despite a bonsai that will not grow taller and larger. So as a parent, we must prepare our families to live independently without having to burden the other party. What steps must be done?

In the course of time a family will enter the stage of children newly born, entering kindergarten, the school, the graduate school and start working. While her parents are in work ranging from the level of staff stepped forward to the highest level in a company or business.

As an illustration, there are two late goals to strive for a family. The first, older children graduated from College, is that levels of Bachelor Degree or Master. Secondly, we as parent (husband and wife) have a stable financial while entering retirement.

We discussed the first, education of children. Education in United States is quite expensive, the kindergarten level alone could spend the funds of thousands of dollars. Moreover, the level above it. So the first we do is determine where the children will we get to academic foundation we adjust with the ability to generate income at the moment and a projection into the future. Whether we will get school in a public school or private school, or within the country or abroad. After that we are projecting how much the funds necessary for the education of our children. As a parent we expect that children will have independent living after graduating from education that we provide.

Secondly, life after retirement. Life after retirement means a situation where active income (income earned by working actively) is no longer there. After retirement costs obtained from passive income, whether from the retirement funds of investments, or fertilizer as long as we are still actively working. What are the costs that we have to spend time living both parents and children are independent. In addition to daily living expenses, medical care costs also increased with increasing age. Also the costs for other activities that become our dreams, for example the roads out of the country every certain amount of time or other activities.

By preparing our financial goals for both of the above, then we are already preparing our families through life in this world without depending financially to another party, whether it be our kids or other civil authorities. If we had a dream that was higher than our current revenue conditions, we can work harder or working smarter. We can do with owning your own business outside our primary job that will generate passive income or are we doing business through an MLM is also promising a passive income and a great value. Or by investing in instruments to suit our circumstances. We can invest in stocks, mutual funds, property or other investment instruments.