Importance of Financial Independence in Today's World

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Financial Independence refers to being in the position of having sufficient funds to pay one’s living expenses, without dependency or reliance on external funding or debt. Financial Independence is very crucial to do so, regardless of the fact whether you are employed, entrepreneurs or freelancers.

Financial Independence can be attained by investing early but its never too late to start investing.

It basically refers to a state wherein you work because you choose to work and not to pay for your living.  

Financial Independence is a subjective phenomenon and does not necessarily mean the same concept to each person. This happens because each person’s financial objectives are unique and their long-term goals also differ from each other.

It takes good financial habits, healthy spending patterns, proper planning and investing to attain Financial Independence. Impulsive spending, improper expenditures and not making timely investments are all hindrances to financial independence. With passing time, Financial Independence is becoming inevitable because it makes money work for you and helps one in living a convenient post-retirement life.

In this write-up, we will discuss some of the major benefits of Financial Independence and how it must be considered important  for every individual from a very young age. Some of the top benefits of Financial Independence are: -

1. Prepares for Contingencies

Financial Independence plays a very important role in the time of emergency. Life is uncertain and there may be times of sickness, injury, job loss, car troubles or a need to support family members. However, if one is Financially Independent and has planned their savings and investments in a systematic manner, it becomes easier to sail through tough times and be prepared for the unexpected.

2. More Financial Security

Financial Security is one of the most important factors in leading a stress-free life. One must find ways to have multiple income sources rather than just their job.The ways in which corporates operate is changing and thus the concept of job security is also becoming different. In such times, being Financially Independent enables one to be in a better position so that they are not dependent on their salary. Also, one does not need to be at the mercy of others, if they face a scenario of unemployment.

3. Early Retirement

Having a revenue stream when one plans to retire has become one of the most necessary aspects in the present times. Pursuing Financial Independence can be beneficial in the long run as one can plan an early retirement if one wishes to do so. Having sufficient funds to ensure that the later part of one’s life can be lived without tensions can be achieved by being Financially Secure and Independent

4. Freedom to Choose

Among the multiple benefits that Financial Independence can help in achieving are buying a property, moving to a new city, traveling, starting a new hobby, pursuing a new business, donating money, resigning from jobs, taking a work sabbatical etc.

Many doors open when one attains Financial Independence and there is a lot of freedom to choose, what one wishes to do, instead of just focusing on how much to earn. This, freedom of choice is one of the biggest benefits of attaining Financial Independence.

5. Stress-Free Life

Having a passive income source, minimizing expenses and planning investments in an organized manner are steps to living a stress-free life while also being assured that Financial Independence has been attained. One can continue to earn for as long as they want but they will not have to do so with stress and worries related to meeting their financial needs as financial independence helps them in being free of stress.

Financial Independence and Creating Wealth go hand in hand and it starts with Goal Planning. Regardless of what stage one is in their life, starting financial planning to become independent is very important because it makes their future life a lot easier and the benefits of financial freedom cannot be denied. Moreover, starting financial planning at an early age allows investors to avail of the benefit of compounding and the time value of money also increases over a period of time, enabling investors to build a bigger corpus.

We at mastertrust help investors to attain Financial Independence while also keeping in mind their financial needs, financial emergencies, future goals and needs in mind. Our experienced professionals bring along years of experience in financial advisory services and we enable our investors to become financially independent over a period of time. Connect with us today to learn about many aspects related to Financial Planning.