“Quality is not an act, it is a habit.” – Aristotle
I have had the opportunity to meet and work with hundreds of people through my work experience, from CEOs of large companies to people who struggle to pay for groceries and everyone in between. Unfortunately, in our society, most people have never tasted financial freedom. The elusive dream seems just out of our grasp. What makes those who are financially free different from those who aren’t? To achieve the freedom that most people don’t have, you have to do things that most people don’t do. Financially free people do not get there by accident. It is a series of choices over time that achieve extraordinary results. This post will outline some characteristics of financially free people that I have had the pleasure of meeting and working with.
1) Consistent
Financially free people understand that it is on them to become financially free at the end of the day. There are no shortcuts, and it requires daily responsibility and reflection, which they embrace.
Simply put; Financially free people do every day what other people do occasionally.
One of my favorite definitions of consistency is “the achievement of a level of performance that does not vary greatly in quality over time.”
What’s beautiful about this definition is that consistency does not mean perfection. Again, for someone in the back, consistency is NOT perfection. Consistency requires a longer time horizon to be evaluated. You can’t be consistent doing something once, and by the same logic, you can’t be inconsistent not doing something once. Another way to look at it is that consistency has failure built into it. For example, if you brush your teeth 360 days out of the year, you have consistently brushed your teeth. No one requires 100% accuracy to say you are consistent in something.
When you are consistent in your finances, results will follow.
2) Live Beneath Their Means
A simple but essential concept, financially free people spend less than they make. It doesn’t matter how much money you make if you don’t create financial margin in your life. Just because you can qualify for an $800k mortgage doesn’t mean you should purchase an $800k home.
Life throws unexpected punches our way all the time, and those with margin can take and roll with the punches. Unfortunately, most of us get trapped in buying things we can’t afford to impress people we don’t even know or like. We don’t realize the things we buy are actually the chains keeping us from affording freedom.
I’m not saying that buying things is bad, quite the contrary. I am saying that things have more than just the monetary cost to them. They are always strings attached. Please make sure you are aware of the FULL cost of what you are buying before you decide to buy it. The new car may make you feel cool, but is it worth destroying your inner peace because of the debt you are living in?
Financially free people sacrifice what they want now for what they want most.
3) Committed To Saving
Shocking, I know, but financially free people save money! I doubt any of us would think of that. In all seriousness, though, the people I know who genuinely live in financial freedom are committed to saving.
Financially free people have mastered the art of saving, and they realize that saving is not simply what they do, but it is who they are.
A pretty common question comes to mind when you think of savings which sounds something like how much should I save? I think the answer depends from person to person and situation to situation. The people I have seen experience an enviable level of financial freedom typically save at least 15% of their income and often more than that!
I know that saving 15% of your income sounds like an impossibility for many of you reading this. What’s more important than the saving number is being committed to savings, whatever that looks like for you. If it’s just cleaning up your debt so you can save, do it! Fall in love with the process, and the results will follow.
4) Never Stop Improving
“I am not in competition with anyone but myself. My goal is to improve myself continuously.”
Bill Gates
Financially free people improve themselves daily. They truly understand that the best resource they have available to them is themselves. Everything in our lives is just a reflection of ourselves; whether we are continuously aware of that fact doesn’t change its reality. A cluttered room indicates a cluttered mind. More accurately, your cluttered mind is just manifesting itself in your room.
Life is moving away from us constantly. If we are staying stagnant, we are actually getting worse. Financially free people understand this and apply it in all areas of their lives. They are growth-obsessed. Whether that be in relationships or finances, they want to improve and make things better constantly.
Every day we have the opportunity to be better than we were the day before. It truly is a gift that financially free people take advantage of.
5) Have Perspective
In my experience, most of the problems that life throws at you can be solved by a change in perspective. When we are too zoomed in to a problem, we make mountains out of molehills, but we minimize the impact of a problem in our lives when we are too zoomed out.
Financially free people constantly adjust their perspectives and look at things from all angles. It seems to me they always travel light. They understand that today is a gift that should be enjoyed, tomorrow is something that should be planned for, and yesterday can be learned from but not changed. When you carry a proper perspective and can look at things from difficult angles, you realize how many options you have available to you.
You are never truly stuck, sometimes you just need to find a new angle.
6) Embrace The Journey
Most of us have this idea of a monetary amount that will allow us to be financially free. Whether that number is 100k, 1 million, or 10 million, once we hit this magical number we are financially free.
Just like consistency isn’t perfection, financial freedom isn’t wealth or a dollar amount. Financially free people realize that being financially free isn’t a point on a map but rather an identity that you walk in daily. When you are able to realize that being financially free is who you are, you suddenly know what to do.
Financially freedom doesn’t rely on anyone but you. Identity change comes before your situation changes.
To quote the great Les Brown, “By the yard it’s hard but inch by inch it’s a sinch.”
7) Don’t Do It Alone
We are social animals. We need others. It really is that simple.
“If everyone is moving foward together, then success takes care of itself.”
Henry Ford
I seldom find financially free people without a community they rely on. I’m not saying it is impossible, but it is definitely not probable. When you are in a community, you are more likely to take risks and grow. They almost all have a mentor and people who speak into their lives which I think is very important.
Ultimately financial freedom gives us the margin to do what we want with the people we love most. If you are seeking finances for just financial sake, I would really challenge you to think why you want this? I believe that path does not lead to fulfillment but actually keeps you in chains.
Relationships and community are what we need, and financial freedom allows us to engage more readily while practicing financial freedom shapes us into a better version of ourselves daily.
