What Does Financial Independence Look Like? (2024)

This post is by our regular Wednesday contributor, Erin.

Do you dream about the day you’ll be able to leave your working days behind and enjoy life to its fullest without any worries?

Do you dream about having enough money to fund the life you want to live so you’re not chained down?

Do you dream about traveling the world, volunteering for an organization you love, or spending time with your family – time that’s not restrained by your job?

If so, chances are you’ve given some thought to financial independence – the point where you have enough money saved up to support yourself, you don’t need to work for a paycheck anymore.

Financial independence really isn’t that simple to define, though. Many of us have different views and expectations when it comes to being financially free.

Some personal finance bloggers are already living this lifestyle, and each do it differently. Let’s take a further look at what financial independence looks like.

Why Become Financially Independent?

First, we should cover why people want to become financially independent.

Unfortunately, a lot of people are skeptical of the idea because they don’t think the term “millionaire” could ever pertain to them.

It saddens me when people put that roadblock up immediately. They don’t stop to think about what being financially independent could mean for them. They’ve already resigned themselves to working for another 40+ years (usually in jobs they hate).

Well, those that value financial independence have different priorities.

Some want to stay at home and raise their children without the inconvenience of work getting in the way. Some want to be the master of their own journey – they don’t want to be dependent upon a paycheck or their boss.

Others want to travel around the world without a time limit imposed on them. Even more want to dedicate their lives to something that’s more meaningful than what they were doing before.

The bottom line is people don’t want to stay in the traditional workforce because of the tradeoffs they have to make. Limited vacation and sick time, working in a cubicle, or working to make someone else’s dreams come true – these things aren’t appealing. Financial independence gives you freedom.

Does Financial Independence Equal Retirement?

Many would say no, at least not in the traditional sense we’re familiar with, even though financial independence and early retirement go hand-in-hand.

Being financially independent doesn’t mean you have to leave the workforce forever. If you’ve been stuck in cubicle-land for 10-20 years, financial independence could be the perfect opportunity to find your true calling, despite what it might pay.

Early retirement certainly doesn’t have to equal playing endless rounds of golf, playing cards with friends, or sitting around relaxing all day. We need to stimulate our brains somehow, and thankfully, there are an unlimited amount of ways we can do so once we reach financial independence.

What Financial Independence Looks Like for Some People

I wouldn’t be familiar with the term financial independence had I not started blogging. I never considered the concept of early retirement because, well, it didn’t seem possible. No one in my family had done it.

I’m thankful there are people out there documenting their journey so others can be inspired by it. Just from the blogs I’ve read, here are a few paths people choose to take once they reach financial independence:

• Travel: Most people don’t get a very generous vacation package at work. Even if they do, they’re still limited. What happens when you want to travel for years at a time, stopping home only occasionally? Working remotely and traveling are very common for those who have reached financial independence.

• Homesteading: Some people are content to live a simpler life once they reach financial independence. They’ve had enough of the hustle and bustle of the city, the expenses that come with it, and the “rat race” mentality that seems pervasive in city/corporate culture. Homesteading might align perfectly with their values to live well on less and be self-sufficient.

• Business Owners: There are many people who choose to become business owners first to accelerate their path to becoming financially independent. Being able to control your salary is a nice perk. Having a side hustle can turn into a full-fledged business, and if you plan well enough, you can eventually turn it into a passive income stream.

• Stay-at-home-parent: If you start planning and saving early enough, you might be able to achieve financial independence before you have children. This gives you the freedom to raise your child and be there for them every step of the way.

• Education/Hobbies: You might decide you want to go back to being a student. If you’re just in it for the knowledge, you can devote your time to studying, and you don’t have to spend thousands on tuition. You can also choose to improve upon a hobby by developing new skills and learning all the tricks of the trade.

This isn’t an exhaustive list by any means, but it gives you a general idea of the opportunities you can take advantage of once you’re not working for someone else.

What I Want Financial Independence to Look Like

I often wonder what I want my life to look like once I’ve (hopefully) achieved financial independence.

I don’t believe I could follow the “traditional retirement” path and swear off work forever. I like to keep busy, and I enjoy the challenge of tackling different tasks. I need goals to work toward – I’m not satisfied with doing absolutely nothing.

Not having to worry about money, I would probably spend a lot of time volunteering. I enjoy helping people and knowing I’ve been able to make a difference somewhere.

If I could combine that with travel, learning new things, and having a little business on the side, I think I’d be happy.

Financial Independence is About Choice

I think it’s clear the end goal of being financially independent is to have choices. When you don’t need money, you have more opportunities.

After all, think about it – how much time do you spend working every week? What would you do with those 40+ hours if they were to suddenly open up?

As long as you calculate and plan carefully, you can afford to travel around the world. You can afford to volunteer for a good cause on a long term basis. You can afford to stay home and raise your kids without the interruption of work. You can afford to build a passion-fueled business.

You’re free to live life on your terms, and you’re free to experiment with what brings you the most happiness.
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At the end of the day, we only have so much time left here. Many of us have a burning desire to make a difference, to see the world, or spend as much time with our loved ones as possible.

Working 40+ hours a week for the rest of our lives robs us of those opportunities. Financial independence brings them back to us.

Are you working toward financial independence? What do you hope it looks like for you?