A Millennial’s Path to Financial Freedom
If you’re reading this then you probably already know that school doesn’t teach us to be wealthy, indeed, it teaches us to be subservient and to ‘get by’ in life by jumping through hoops. It teaches us the fundamental principles of being employed in a traditional, and somewhat archaic job, that has not caught up with the modern era of portfolio careers, remote working lifestyles, personal branding, and zero hour contracts.
More specifically, it has never taught us to create a career that leads to financial freedom – it has focused instead on financial security, which has always been linked with having a secure job.
See, the way most people earn a living is to trade their time for money, yet the challenge with this approach, even if you are a highly paid professional like a doctor or surgeon, is that there are only so many hours in each day, week, month and year that you are able to trade your time for money – and there is a ceiling to what people are willing to pay for each hour that is traded.
Herein lies the reason so many people who are employed or self-employed are stuck on a financial treadmill; often referred to as the rat race. The problem with this approach is that it is like a never ending treadmill.
Now, it might feel emotionally different if you are in a job you love, and perhaps you feel totally fulfilled having pursued an online msn program that means you’re in the nursing job you’ve always dreamed of… but from a pure financial perspective, there is a need to get out of the financial trap of trading time for money.
The millennials path to financial freedom is very simple; use the power of leverage and automation to create passive income that means you are no longer directly trading a unit of time for a unit of money.
Use the Power of Leverage
It might be helpful to think of financial leverage using the example of an author. An author writes a book and makes $1 net profit per book sale. The author may have spent a large amount of time writing that book, but once it’s published, it’s done – they are no longer swapping their time for money – they have an asset they can leverage time and time again.
Whether the book goes on to sell 1,000 copies or 100,000 – the income derived from the initial effort required to create this asset will be generated without them having to be physically present and directly swapping their time for money.
A further example is that of a musician; in that they put a lot of effort into creating an asset in the form of a song that is then leveraged time and time again, each time earning a small royalty when the song is played; or a property developer that invests a lot of initial time in sourcing and renovating properties, but then automates his income by using an estate agent to find and manage the tenancies which yield a healthy profit each month.
This is where most millennials are making the mistake; they are simply going to a job and trading their time for money, rather than building assets that generate long-term income. This is the path to financial freedom.
ContributorDallas Dorrall is passionate about music and is living her dream managing and promoting Nashville/Muscle Shoals based Country Music Artist, Johnny Collier, currently touring the US. While traveling, she enjoys reviewing new artists, restaurants and nightclubs. Dallas is crazy about her family and friends and attributes her enthusiasm for life to a quote by Marianne Williamson (which she still reads every day) entitled “Our Deepest Fear”.