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Gladys Tan

Financial Consultant

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3 Ways to Start Building Towards Your Financial Freedom (Rethinking Retirement)

Updated: Mar 29, 2023

Let’s Rethink Retirement...

Those who are young see retirement as something very far-fetched. Usually, it’s because they associate it with being old. Others see it as a time of doing nothing and may worry about how to occupy themselves.

But what if it meant that work becomes optional?

Let’s say that your boss does something you don’t like OR there's a new boss in town that you don't align it - wouldn’t it be nice to be able to say “bye!”?

This is why we need to rethink retirement. What we may want to do is shift our focus on achieving Financial Freedom. This means you will no longer need income from a job.

When I meet people for the first time and ask them what their definition of financial freedom is, most typically reply with a question: 'Do you mean retirement?'

Retirement is an event that will eventually happen in most of our lives. We gradually lose the ability to work, which could be due to health, employability, unforeseen circumstances, etc. We may be forced to retire and not yet achieve financial freedom.

That is the reason why many are working hard towards FIRE (Financial Independence, Retire Early) instead. And this is what I like to tell my clients to focus on, too.

When I ask my clients when do they hope to attain financial freedom, their answers typically involve some time in their 50s rather than 60s. Some are actually working towards this dream as soon as they are in their 40s! This is a fair assessment of where you see yourself achieving your desired financial freedom moment.

However... food for thought: instead of an age at which you want to retire, how about thinking of the income at which you can be financially free?

Want to be financially free? Here's how you can start:

Clear Debts

Start by paying off your debt with the highest interest rate first and work your way down from there.

Secure Financial Foundations

Consider the financial risks that may get in the way of you achieving financial freedom. Take, for example, rising healthcare costs can potentially be a huge leakage to your financial freedom goals.

Derive The Income Amount You Want

By working backward, we can calculate how much you need to save and invest at what target rate of return in order to create your desired amount once you stop working.

Knowing the income number that will provide you financial freedom and having a strategy for achieving it eliminates a lot of the anxiety about being ready to retire.

You no longer have to question whether you’re saving enough money or whether the returns on your investments are adequate. You will know where you’re headed and you’re taking the actions needed to arrive at your destination. That clarity is a boon not only to your eventual retirement but to your peace of mind in the years leading up to it.

You deserve this. Let me know if I can help!

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