Personal Finance 101: What is Financial Freedom?

One life lesson I consider as very important is financial freedom.

I’m a Professional Accountant, and in my profession, we always talk about money or finances.  However, most often, we talk about the money of big business firms and individual, but not of our own money.

Despite the reality that I am professionally educated and trained to count money, I’ve used to neglect it on my own personal finances.  Until I’ve learned about financial freedom.

Learning financial freedom wasn’t like a light bulb that suddenly pop into my head and showed its importance.  Unfortunately, I’ve learned it the difficult way.

It was during my favorite event in life, the depressing and difficult stage back in 2008. I’m saying it’s my favorite because aside from the other many life lessons I’ve learned from such event; it also cultivated the person and life I have become now.  And one of the important life lessons I’ve learned was financial freedom.

During that difficult moment, I was mentally, physically and emotionally stressed because of too much workload.  And what made it worse is my work back then was on graveyard shift.

Graveyard meant that while everyone is sleeping, I’m working.  On the reverse, when everyone is working, I’m sleeping.  Short to say, I was working on a night shift.  So imagine how it physically affected my body and life system in general.

But that wasn’t the worse part, because aside from the inconvenient work shift, I was not financially satisfied.  Because unlike it used to be, being a Professional Accountant isn’t as lucrative and prestigious as it used to.

In the time of my mom, which is also a professional accountant, being a professional accountant was a privilege and monetarily satisfying.  They had high salary and benefit packages which also include a nice retirement plan.  So if you are employed as an accountant in a big company, your financial security is guaranteed.  It was because during her time, there were only few accountants.  This is the opposite in our time now.

Currently, we have a high number of supplies of professional accountants, especially in my country.  And using the law of supply and demand, you can already predict what happens to the demand if there is too much supply.  In my case, it meant lower salary and employee value.

I’ve proven it in my previous work experiences.  Because despite the fact I’ve worked as a Financial Accountant in a multinational fortune 500 oil company, my salary did not match my competence and workload.  And who is the culprit?  It is outsourcing.

I’m not anti-outsourcing, in fact, if you are doing business, it is a great business strategy because you make use of technology and at the same time, you are able to cut-cost on administrative expenses.  But the disadvantage is if you are an employee, and not a business owner.  If you are an employee, you wouldn’t be receiving the compensation that you deserve and there will be no retirement benefit.  Plus, you will most likely end up working with too much responsibility that is occupied by more than one employee.

You are probably wondering why I am talking alien stuff here, like business, accounting and outsourcing.  Well, it’s because this realization is what opened and taught me the importance of financial freedom.

What is Financial Freedom?

Financial Freedom is defined as the ability to acquire the lifestyle that you want without worrying on your finances because you have achieved financial stability and security.

To clearly illustrate my point, if I tell you that today will be the last day you are employed.  The company you are working with suddenly fell into bankruptcy and can no longer sustain its operation, what will you feel?  Or if you were fired because the company is cutting its cost, how will you act upon it?

If you felt scared and worried with the news because you don’t have enough savings to sustain your needs, or worse, you are filled with debts that you can’t be unemployed, then you are financially broke even how high your current salary is now, and even though you have owned many “assets” or properties.

But if your action and feeling was relaxed and calmed, you are perfectly okay with the thought of being unemployed for awhile because you were able to save enough money which can sustain your needs for more than six months, plus you don’t have debt to worry about, then you are financially okay, no matter how small you earn and how little your assets are.

Either situation has not attained financial freedom.  But if I ask you, which is better, high salary but financially broke or low salary but financially okay, what will you choose?

Whatever your choice is, take this time to have self-analysis on what kind of financial status do you currently have.

Importance of Financial Freedom

Two key notes you have to remember about financial freedom:

1)  Ability to Live the Lifestyle that You Want

Tim Ferris, author of the best-selling book Four Hour Work Week, have said,

“Being financially rich and having the ability to live like a millionaire are fundamentally two very different things”.

There are a lot of people who are financially rich and stable, yet they are too busy working that they don’t have time to enjoy their richness.  They can’t afford to take a day off and just enjoy life.

If you attain financial freedom, you are able to live the lifestyle that you want.  What does it mean?  It means you can afford to take a day off and do whatever you wish without worrying about your work or finances.  You can buy things you want and need, you can visit places anytime, plus you have the luxury of choice on how you will spend your time.

I know this may sound impossible, especially for people who are trapped in the 8-hour, 5 days cycle.  But if you have achieved this kind of financial freedom, probably, you are nodding in agreement.

2)  No Financial Worries and Problems

Another advantage of financial freedom is the elimination of financial stress and worries.

People who are able to attain financial freedom have high ability to manage their finances and have great skills in generating money.

These two characteristics are the one you should strive to develop if you want to attain financial freedom, (1) manage your money and (2) develop a skill of generating money.

When you develop these two characteristic, you will never worry about money.

Remember, money without time does not represent life richness.  Because why is it a lot of wealthy people are not happy with their life?  Because the key to financial freedom is not money alone, it’s the ability to have both money and time.

The day I’ve learned the importance of financial freedom, it changes all the anxiety and stress of my life.  Understanding financial freedom opt me to act on my financial status instead of worrying about it.  Believing in the importance of financial freedom has created so much positive changes in my life, financially, lifestyle, mentally, emotionally and even physically.  And at the same time, it helped me developed my spirituality, by being more appreciative to life and having high hopes in its miracles.  And that’s what I hope will happen to you as well.

For a final note, let me leave you this phrase to think over:

“Money alone isn’t the solution to people’s worry and stress.  Most part of it is laziness.  The usual excuse of “if only”. Like, “If only I had more money”.  Because if only is the easiest way to postpone the intense self-examination and decision making necessary to create a life of enjoyment now, and not later.  It’s the usual excuse of not acting.”


  1. Financial freedom also means you giving importance and value to what you already have.

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