Security or Freedom

There is financial security and then there is financial freedom. Two very different themes.

Financial security is a defensive thought process. Security implies safety, consolidation, preparedness and defense. When you think financial security you are usually thinking about protecting what you have and having enough to survive future obligations and demands.

Financial freedom is a more holistic view of the world. Money is an integral part of living in a materialistic life. And there is no quantifiable limit at which you achieve financial nirvana. More or less are subjective terms which lose significance as you expand your financial thinking. Financial freedom comes when you have a healthy and pragmatic attitude towards money. This means

- Wealth Creation: Financially savvy people focus on saving and frugality along with trying to increase their revenue potential. Income generation, diligent saving and smart investing lead to wealth creation.

- Money Management: The more you have the more challenging it becomes to sustain and extend that portfolio. A key tenant of financial well-being is learning to manage your wealth. How much to invest, when to invest, how to plan, how to diversify … you have to make your money work for you and that is not an easy task. Having more money does not decrease your financial commitment – your effort/time investment goes up.

- Holistic Living: Money buys you things but there is only so much to buy. After the buying binge you have to rethink your existence in the context of this world. Community, charity, giving and helping are key components of a holistic lifestyle. Leveraging your money to change the world for the better gives you personal satisfaction and completes the cycle. You create, nurture and set it free.

Financial freedom is a lifestyle and when you adopt that lifestyle you make financial management a core component of your life. When that happens you stop reacting and start implementing sustainable and long term financial strategies. That in my view is financial freedom!

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