What is Your Financial Freedom Number.
This process is a fun little task and done properly is fundemental in working out what it will take to make YOU financially free – and i’m guessing that’s why you’re here!
Before we get onto the calculations I want you to just imagine what your life looks like as someone who is Financially Free.
As discussed before Financial Freedom is not living in a 100 room converted castle nor is it being a Millionaire – I know how the mind wanders in these exercises – mine used to all the time and still sometimes does!
“Financial Freedom is having enough passive or risidual income to cover your living expenses”
Imagine you earn enough money from an online business that matches your day job – the same wage you earn at work comes into your bank again – two sources of income – sound good?
Let your mind wander for a moment and imagine what a typical day looks like as you – but a financially free You!
Do you choose to stay in your job?
Do you choose to travel more?
Do you choose to spend more time with family?
Where do you choose to live?
What cars do you choose to own?
Do you choose to travel more?
Do you choose to spend more time with family?
Where do you choose to live?
What cars do you choose to own?
What places do you choose to visit?
Remember as someone who is financially free you have the luxury of choice – how do you spend you day? The CHOICE is literally yours!
Most people think that this kind of life is too good to be true and they start to have self doubt and don’t even pursure it – but this time it’s different, you will be taught step-by-step how to achieve this by me.
Have a guess what your Financial Freedom Number is?
How much money do you think you need (monthly/yearly) to be financially free –
Write it down and come back to it later!
Lets calculate Your Financial Freedom Number
We calculate Financial Freedom in Four tiers:
The first tier is your – Security Number
Security Number
This is the amount of money you need to run your home, cover transportation, pay ALL your priority bills and put food on the table and have basic entertainment (TV/Phone)
*DO NOT add things like Netflix, Apple TV, or any other subscriptions to this calculation – just TV/Phone costs.
Add all these costs up and make a note of the number.
We will use a fictious example here in British Pounds (£ GBP) adjust accordingly for your currency:
John Doe (monthly):
Rent: £800
Transportation: £300
Transportation: £300
Bills: £500
Food: £200
TV/Phone: £120
TV/Phone: £120
Total £1920 – (approx £23000 per year)
The second tier is your – Lifestyle Number
Lifestyle Number
This is the amount of money you would need to cover clothing costs, gym membrships, beauty/cosmetics, dining costs, hobbies and interests, and other subscription services.
(monthly)
Clothing: £200
Gym: £60
Cosmetics: £40
Dining/Socialising: £300
Hobbies/Interests: £300
Other Subscriptions: £100
Dining/Socialising: £300
Hobbies/Interests: £300
Other Subscriptions: £100
Total £1000 – (approx £12000 per year)
The third tier is your – Luxury Number
Luxury Number
This number is the amount of money you would need for your vacations, or luxury gifts for the year.
2x 10 day holiday £5000
6x Long weekend breaks £4000
6x Long weekend breaks £4000
2x A nice gift to self £2000
Total £11000 – (for the year)
Add together your Security Number, Lifestyle Number and your Luxury Number – this is your Financial Independence Number, this is the number that gives you financial independence but not financial freedom.
John’s Financial Independence total is – £44,000 per year (approx)
The fourth tier is your – Investment Number – this is the final piece to the puzzle that makes you financially free and that is saving money, to be truly financially free not only do you need to cover all your expenditure costs but you also need to factor in an investment number.
Investment Number
This number is the amount of money you choose to put away and save – this number is totally subjective and is purley for savings and those unexpected costs that always surprise us – it just goes away and is only touched when absolutely necessary.
For this example I will say that John wants to save £1000 per month – (£12000 per year).
These 4 categories make up what it would take for you (or in this case John) to be Financially Free and live the most amazing life – so let’s add up the final total.
This total is your Financial Freedom Number!
So, for this example John Doe would need to earn £58,000 per year which is approx £4,800 per month.
All of John’s financial areas were met, he can run his flat/house and transportation, he covers his lifestyle costs, he has 2×10-day holidays and 6 long-weekend breaks throughout the year along with buying 2 luxury items for himself and finally he puts away £1000 every month saving and building that nest egg for something in the future or to cover unexpected costs that crop up in life.
This total is nowhere near the realms of being a millionaire – it’s not an out of reach unattainable 7-figure lifestyle, nor is it even an unbelievable 6-figure dream, it’s a very attainable and believable 5-figure salary.
So, now it’s time to work out what your Financial Freedom number is – and when you do ask yourself – was it higher or lower than your original guess?
Work Out Your Financial Freedom Number Now!
You now know the amount of income you need to earn to become Financially Free, write this total down – keep it safe – we will now work towards creating a business and some side incomes to generate this amount of money!
How much monthly income do you need to earn? Let me know in the comments below.
It’s now time to start the training so click the button below and head over to ‘The Menu’ I hope you are hungry for success online.