MINDSET
MONEY TALK
The 7 Steps to Financial Freedom
BUILD, GROW, EXPAND YOUR PASSIVE INCOME
STEP SIX
by Gene Powers
vision of life we would have in finan - cial freedom, we then laid our plan to research and find the right vehicle and to attain our goal in three to five years. We did not know how (which vehicle) or how long it would require. We set an ambitious target for our plan, and we committed to do what - ever it took. It was nearly one year before we had studied our options with vari - ous mentors to narrow the field and had chosen our investment type. We decided to start a business in this asset type where I would work full time, and which took another year to achieve some revenue. At the five- year mark (three years after reve - nue) we had achieved only about 20 percent of our passive income goal plus some modest active income profit from the business. Our original plan timeline was clearly not going to happen. It was essential at this point that we revise our plan and “STAY IN ACTION” towards our goal. After seven years, my wife was able to leave her corporate job and work in our investment business full time with me while having a little extra cash for trips and luxuries. It was another four years until we would hit our financial freedom goal. The point of the story is that your journey may take longer than
planned. It is essential to measure your progress, adjust the plan, find milestones to celebrate, don’t give up, rest, and persevere as you close the gap to the financial freedom goal you have set. As in our case, it may take longer than originally antici - pated. You may choose to accelerate by downsizing your lifestyle for an extended period. I can assure you that looking back after achieving our financial freedom, those years of austere living and super-saving were absolutely worth it! Focus is essential. Keep your eye on the goal and always measure your progress. How much passive income do you have today? How much more is it than last month / last quarter / last year? How much is needed to support your desired lifestyle? What is the gap? How can you adjust the plan to narrow the gap faster? It is easy to set off on this journey with excitement and enthusiasm. As time passes, when the goal is BIG and seems far away it is easy to get discouraged and to lose resolve. How will you push through this? Be assured that is part of the journey. The strength of your WHY becomes essential; it helps carry you forward even when things are tough. Our financial freedom goal was lofty. We didn’t know when we began
FollowYour Plan, Measure Progress, Rest, Adjust Plan, REPEAT. In step five, you chose the pas - sive income vehicle well-suited to you, and devised a plan for how you will develop the expertise to make these investments for your finan - cial freedom, and you began your journey. A critical part of your plan is your budget and how much of your income you will save each month and how much time you will spend towards making these investments each month. An absolute mini - mum requirement is 10 percent of your income per month must go to your financial freedom fund mak - ing investments for passive income. I believe the same applies to your time. The rate at which you save and reinvest in your chosen vehicle and your GOAL for monthly passive income together largely determine how long it takes you to reach your goal. You may have a REALLY BIG DREAM and ambitious financial goals and not a clue as to how you will get there. My wife and I have been there. We also set a very ambitious initial timeline for getting there. When we arrived at and committed to the
80 | think realty magazine :: january 2021
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