Achieving Financial Independence May Not be What You Think

October 6th, 2007 | Stacey | Residual Income, Debt Management, Passive Income, Multiple Streams of Income, Financial Freedom, Financial Independence

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As we all rush toward achieving financial independence, what exactly is it we are scurrying for? Do we want to retire? What is financial independence anyway and can it help with debt?

Financial independence means you don’t have to work to earn money while you have an income to pay your bills. Defined by the book Your Money or Your Life, financial independence is “having an income sufficient for your basic needs and comforts from sources other than paid employment”. When you are paid employee, you can lose your job or your hours and then your income become unstable along with your finances. Establishing multiple streams of income through passive residual sources allows you to continually earn money from your original efforts without having to work for it.

Examples of passive residual income include rental properties, dividends from shares, royalties from inventions and creative endeavors and business profits, such as affiliate marketing. You define your own sources of passive income and choose options that are easy and comfortable for you to handle.

You can also lower your debt and cost of living to achieve financial freedom sooner. The more basic your needs and expenses, the easier it will be to attain financial independence.

Achieving financial independence is not just a dream, it is a reality for many savvy people. By choosing the right opportunities and keeping it real, you can be financially free sooner than you may think.