I started this blog nearly two years ago (does time ever fly by), and since then I have written series of posts covering a wide range of topics, such as buying your first home, how to invest for your retirement, and building your path toward financial freedom. I have greatly enjoyed writing about all of these topics, but I feel it is time to start adding a bit of focus to my writing, and to strive toward a laser-like intensity toward the ultimate goal of achieving financial freedom.
I have started out on a new journey of entrepreneurship, and in a way, I am living out the dream I have strived toward for a long time now. I have not yet reached financial independence, and I might still be a while away from there, but I am on the way. My writings will continue to be personal, and I will continue to write under the frame of this new mindset and stage of life.
THE CHANGES AHEAD
To give you an idea of where I want to go, one of my favourite series is the one on living to 100: Investing in your future. I really do believe that there are changes coming that are going to completely change the way that we live our lives, and blow open many of our common biases and ideas about the way that things work.
On my other finance site, Financial God, I delve more into the political and moral morass that we find ourselves in, and I also share some of the amazing technological changes coming down the road that have the potential to radically change our lives, for better or worse.
To put it concisely, while it might not be the end of the world, I do think that 2012 is the beginning of the end of the world as we know it. Things are going to continue to change from here on out, and the questions on everyone’s mind will always be: “How does this affect me?” and “What can I do to prepare?”
A NEW FOCUS
I still believe in the motto of “maximizing your life EV”, even more than I ever did before. EV is an acronym for Expected Value, and it is another way of saying “let’s do what we can so that we don’t just live for the present, nor do we wait until the future: let’s make things better over our entire lifespans”.
How can we do that? I still believe that personal finance is one of the important pillars supporting this goal. A sound foundation needs to include the following components:
- A high savings rate.
- A healthy buffer between income and expenses.
- Low-cost and efficient investing for the future.
Once the foundation is in place, we can build it up and make it stronger over time, and we can eventually use it to support our long-term goals. I am a strong believer in financial independence and freedom from the rat race, so those are the most important goals to me. Here are some of the things that can be achieved through a solid financial foundation:
- Income-based financial independence.
- Wealth-based financial independence.
- The freedom to live the life you’ve always wanted, whether it be freelancing, staying at home with your kids, or starting your own business.
MY OWN PATH
My own path has been both traditional, and unconventional. It has been traditional because I have gone to university, graduated with honours, and I worked in a corporate setting at a good job in a good environment. I had debt, I paid it off, I struggled with low-income wages, made financial mistakes, and learned from them.
This path is not a bad one — work for a few decades, pay off the mortgage, and build up a nest egg big enough to take care of me and my family for the rest of my life, by the time I retire. It is also a very linear path, with not as much room for exploration, trial & error, and risk & reward. For many people, that is not such a bad thing. I never thought of myself as entrepreneurial in the past, and I think that there are many good things to be said for a linear path, so long as one sticks to the basic personal financial foundation.
My path has also been unconventional because I have since decided to give up the stable salary and go and work for my own, even at the expense of a greatly reduced level of income. I have gotten used to a high rate of savings, so my lifestyle has not had to suffer too much even though I have just started out. I am only just beginning to forge down this path, and I don’t yet know where it will lead, but I have greatly enjoyed the experiences and the opportunities that I’ve had until now.
I am not a “get rick quick” guru, and I can’t promise you that the less-beaten path is an easy way to riches. What I can promise you is that by laying down the foundation, you will give yourself the choice, so that you can have the freedom to try one path or the other, and maximize your own life EV.
WHAT’S IN IT FOR YOU?
This site wouldn’t have much of a purpose if there was nobody around to read it. I want to know: Why is personal finance important for you? If you had a bit more money or freedom, what would you be able to achieve? I would love to hear your own stories.