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Writer's pictureAmelia Mei Leng

Financial Freedom: A Personal Journey, or a Universal Destination?

Financial freedom can be varied depending on each individual. Discover your concepts of financial freedom




Financial freedom is a term that has gained immense popularity in recent years. It conjures images of an ideal life, free from the worries of money, where one can pursue their passions, live comfortably, and have ample time to enjoy life. However, the concept of financial freedom is not as universal as it is often portrayed. It is a highly subjective impression that varies from person to person, shaped by individual circumstances, cultural beliefs, personal values, and life goals. What financial freedom means to one person might be entirely different for another, making it a multifaceted and deeply personal journey.


The Prejudice of Financial Freedom


Financial freedom is often defined as having enough income, savings, or investments to live the life one desires without being held-back by a traditional 9-to-5 job. Yet, this definition fails to capture the nuance that financial freedom means different things to different people. For some, financial freedom might mean retiring early and traveling the world. For others, it could mean having enough savings to cover unexpected emergencies without going into debt. For many, especially in less affluent communities, financial freedom may simply mean having enough to provide for basic needs like housing, food, and healthcare.


The variation in the definition of financial freedom is largely due to differences in personal circumstances. For example, a single individual living in a city might prioritize having enough money to enjoy dining out and entertainment, while a family with children might focus on securing funds for their children's education and future. Moreover, someone in a high-income country might consider financial freedom as having a large investment portfolio, whereas someone in a developing country might view financial freedom as the ability to escape the cycle of poverty.


This subjectivity is further influenced by cultural and societal norms. In some cultures, financial freedom is closely tied to the ability to support extended family members, while in others, it is more about personal independence. For Muslims, financial freedom is not only about securing one's material life but also ensuring that wealth is managed in a way that aligns with Islamic principles, such as the avoidance of interest (riba) and the importance of charitable giving (zakat). The end goal for a Muslim is not just worldly success but achieving Al-Falah, or success in both this life and the hereafter.



The Hype and Peer Pressure Surrounding Financial Freedom


In recent years, the concept of financial freedom has been heavily promoted in books, seminars, and on social media platforms. Phrases like "FIRE" (Financial Independence, Retire Early) and "passive income" have become buzzwords, creating a sense of urgency and even fear of missing out (FOMO) among individuals. The narrative often suggests that anyone not actively pursuing financial freedom is somehow failing at life, which can lead to unnecessary stress and anxiety.


This hype around financial freedom can create unrealistic expectations. Social media influencers often showcase luxurious lifestyles funded by passive income streams, which can make financial freedom seem like an unattainable goal for the average person. The constant exposure to these idealized images can create a yardstick by which people measure their own financial success, leading to feelings of inadequacy if they fall short. Additionally, there is a growing trend of individuals using financial freedom as a status symbol, a right to brag about their savvy investments, early retirement, or ability to live without a traditional job. This can perpetuate the idea that financial freedom is only for the wealthy or those with significant resources, further alienating those who may not have the same opportunities.


However, it is crucial to recognize that financial freedom is not about conforming to a specific lifestyle or achieving a certain level of wealth. It is about understanding one's own financial needs and goals and finding a balance that allows for both security and fulfilment. Financial freedom should not be a source of pressure but a personal journey that reflects individual priorities and values.


Financial Abundance but Prisoner to Wealth


The ultimate level of financial freedom which is out of reach to many is coined as Financial Abundance. This is the level of wealth which will last generations. Examples are Conglomerates in the US, Chaebols in Korea, Keiretsu in Japan and Grupos Económicos in Latin America. 


However, even with significant financial resources, many find themselves prisoners to money—trapped by the pursuit of more wealth, driven by fear of losing what they've gained, or overwhelmed by the complexities of managing their assets. This paradox highlights that true financial freedom isn't just about accumulating money but also about achieving a balanced mindset where money serves as a tool for a fulfilling life, rather than a source of anxiety or control. Without this balance, wealth can become a gilded cage, limiting personal freedom and perpetuating the very stress it was meant to alleviate. 


Financial Freedom for All: Is it a Myth?


One of the most damaging myths about financial freedom is that it is only achievable by those who are already well-off. This perception is rooted in the idea that financial freedom requires a large income, substantial savings, and the ability to make significant investments. However, financial freedom is not solely about the amount of money one has but how that money is managed.


For instance, someone with a modest income can achieve financial freedom by living within their means, avoiding unnecessary debt, and saving consistently over time. The key is not how much one earns but how well they manage their resources. Simple practices like budgeting, reducing expenses, and prioritizing savings can go a long way in achieving financial security. Moreover, financial freedom can also be about mindset—being content with what one has and not constantly striving for more. This approach to financial freedom emphasizes contentment and financial responsibility over wealth accumulation.


An example of this can be seen in individuals who, despite not having high incomes, manage to live debt-free, save for emergencies, and even invest for the future. These individuals may not be wealthy, but they have achieved a level of financial freedom that allows them to live without the stress of financial insecurity. This approach to financial freedom is often overlooked in the broader discourse, which tends to focus on wealth accumulation rather than financial stability and peace of mind.



Money, Greed, and Fear: The Emotional Aspects of Financial Freedom


The pursuit of financial freedom is often driven by a mix of emotions, including fear, greed, and the desire for security. For some, the desire to achieve financial freedom is rooted in a fear of poverty or financial insecurity. This fear can be a powerful motivator, pushing individuals to save, invest, and work towards financial independence. However, it can also lead to anxiety and stress, particularly if financial goals are not met as quickly as expected.


On the other hand, greed can also play a role in the pursuit of financial freedom. The desire for more wealth, luxury, and status can drive individuals to take risks, sometimes beyond their comfort zone, in the hope of achieving financial independence. While ambition can be positive, it can also lead to unhealthy behaviours, such as overworking, neglecting personal relationships, or engaging in unethical activities.


The role of risk tolerance is also crucial in the pursuit of financial freedom. Some individuals are naturally more comfortable taking risks, such as investing in stocks or starting a business, while others prefer the security of a stable job and guaranteed income. Understanding one's risk tolerance is essential in creating a financial plan that aligns with personal comfort levels and long-term goals. It is important to recognize that financial freedom does not require taking excessive risks; rather, it involves making informed decisions that balance potential return with the associated risks.


For Muslims, the pursuit of financial freedom is also guided by religious principles. In Islam, wealth is considered a trust from God, and individuals are encouraged to manage it responsibly. This includes not only saving and spending wisely but also giving back to the community through charitable donations (zakat). The ultimate goal for a Muslim is to achieve Al-Falah, which means success in this life and the hereafter. Financial freedom, therefore, is not just about accumulating wealth but ensuring that wealth is used in a way that pleases God and benefits society.



The Pillars of Financial Freedom: Save, Spend, and Donate


In my humble opinion, the way forward in achieving financial freedom requires a balanced approach to managing money. This can be broken down into three key pillars: saving, spending, and donating.


  • Saving: Building a financial cushion is one of the first steps toward financial freedom. This includes creating an emergency fund, saving for future goals, and investing for long-term growth. Consistent saving, even in small amounts, can help individuals build wealth over time and provide a sense of security.

  • Spending: Wise spending is just as important as saving. This involves creating a budget, living within one's means, and avoiding unnecessary debt. Financial freedom is not about depriving oneself but about making conscious spending decisions that align with one's values and goals.

  • Donating: For many, especially in the Muslim community, charitable giving is a vital part of financial management. Donating a portion of one's income not only helps those in need but also brings a sense of fulfilment and purpose. In Islam, giving zakat is a religious obligation, and it is considered a means of purifying one's wealth.


These pillars are interconnected and together form the foundation of financial freedom. By saving, spending wisely, and giving back, individuals can create a financial plan that not only secures their future but also contributes to the well-being of others.



Conclusion


Financial freedom is not a one-size-fits-all concept. It is a personal journey that is shaped by individual circumstances, values, and goals. While the hype around financial freedom can create pressure and unrealistic expectations, it is important to remember that financial freedom is not about conforming to a specific lifestyle or achieving a certain level of wealth. It is about finding a balance that allows for both security and fulfilment.


Whether it is living debt-free on a modest income, achieving early retirement, or managing wealth in a way that aligns with religious principles, financial freedom is within reach for anyone who is willing to take control of their finances and make informed, intentional decisions. Ultimately, financial freedom is not just about money—it is about living a life that is meaningful, secure, and aligned with one's values.


What is your concept of financial freedom? Share with us in the comment section! 


About The Author


Amelia Mei Leng is a Licensed Financial Planner at Wealth Vantage Advisory. Her journey in the financial industry began in internal audit and financial reporting within the hospitality and property management sectors. She later oversaw an investment portfolio at one of Malaysia's largest investment houses from 2008 to 2010. After a decade-long break to raise her children and manage her family, Amelia returned to her passion for finance. She was drawn to Wealth Vantage Advisory for its dedication to making financial planning the core of its business and its strong focus on Shariah-compliant advisory.

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