Don't do anything, lying down to make money is the dream of many people.
Financial freedom is not a new term, and it has been increasingly mentioned in recent years. What does financial freedom mean?
Someone has divided financial freedom into nine stages, and let's see how many paragraphs you've reached.
Starting from Maslow's hierarchy of needs, the criteria for financial freedom are divided into nine stages, which are successively increased, and finally the "ultimate" financial freedom
First Order (Beginner Level): Free vegetable market
That is, in the vegetable market, you can buy which kind of dish you want to buy, without looking at the price of the dish.
Second Order: Hotel Freedom
Go to which hotel you want to go to, and you are not subject to the price of the hotel.
Third Order: Freedom of Travel
You can travel whenever you want to play, without thinking about money.
Fourth Order: Car Freedom
Buy whatever car you want.
Fifth Order: Freedom to learn
They or their children are free to choose their own school or study, regardless of tuition fees and other costs.
Sixth Order: Freedom of work
As long as you are willing, you can choose any job, and without this job, you can create such a position yourself, regardless of whether this job can make money.
Seventh Order: Medical Freedom
As long as the disease can be cured, regardless of the level of medical expenses.
Eighth Order: Freedom of Housing
Buy what house you want, don't worry about the price of the house.
Ninth Order: Freedom of Nationality
You can choose your own nationality, free immigration and free investment, without worrying about the cost of investment.
Are you free after reading it, which ladder are you on, and what level of financial freedom do you aspire to?
What is financial freedom? This is not a new vocabulary, the simplest explanation is that you no longer need to work actively, through passive income you can pay for all the expenses you need, you no longer need to work for money, instead money is working for you, the so-called money to make money, you can do what you really like.
How, is it very desirable to hear?
You might say, "It's that easy, so everybody's a billionaire." "It's certainly not easy, on the contrary, it's very difficult, and only people who are determined and can continuously put in 110% of their efforts to their dreams can achieve it."
A person who is focused on a goal is fearless.
All successes don't happen overnight, and the Path to Financial Freedom divides achieving financial freedom into three stages, which are called:
Financial security Financial security Financial freedom
Financial security: it means that you can guarantee that you can support yourself if you do not work in the next six months to a year, if you spend 2,000 yuan a month (200 calls + 1,000 rent + 800 food) 2,000 yuan, then the money is about 10,000 to 20,000 yuan.
Financial security: Means that if you don't work, you can support yourself with interest. If the annual investment income can reach eight percent, and the monthly expenditure is still 2,000 yuan, then 2,000 * 150 = 300,000, which is the amount of financial security.
Financial freedom: Refers to the fact that the return on the assets you invest has been greater than your living expenses. For example, if you spend 10,000 yuan a month (2,000 basic life + 2,000 meals + 4,000 entertainment + 2,000 clothing) and an annual interest rate of eight percent, then 10,000 * 150 = 1.5 million, which is the amount you need to achieve financial freedom.
So now calculate how much money you need to reach each of the three stages above, and which stage are you reaching now?
The three stages are progressive and related to each other. It's like you have three pools: upper, middle, and lower. The pool above is the smallest and the pool below is the largest.
You need to make sure that the topmost pool is filled with water (funds) first, and then the extra water flows into the middle pool, and when the middle pool is full, it flows into the bottom pool.
That is to say, you must first ensure that you achieve financial security, exceed the financial security needs, and then fill the financial security with surplus money, and finally it is possible to have financial freedom.
Financial security is to cope with sudden economic changes, which is a guarantee for individuals and families, and should be maintained in time without accidents, and this part of the money should be stored in low-risk and high-liquid banks, monetary funds or cash.
Financial security saves us some of our anxiety. Even if you reach financial security, you have to empty your pockets when the unexpected happens. While you survived the crisis safely, your capital was also depleted. Only by accumulating enough capital to live entirely on interest can you be considered truly safe - so you need a second pool, there are golden geese in the pool, the golden goose begins to lay eggs, so that you get no less than 8% of the return, you can invest in low-risk, medium-risk, high-risk areas according to the principle of 40:40:20.
Financial freedom is an advanced version of financial security, you can't just have basic living expenses, you still have dreams, your desires are always inflating, you want to be happier
There are two ways to boost happiness: increase income and reduce desire.
Once you've achieved financial security, you can invest a portion of your money to achieve financial freedom. At this time, you can take a higher risk and look for investment opportunities with a yield of at least 20%-30%. Even if one of these investments fails, you can easily get compensated for from other high-yield investments.
So how to achieve financial security or financial security?
The Path to Financial Freedom gives an approach that consists of four strategies:
1. Store a certain percentage of your income 2. Invest with savings 3. Increase your income 4. Save the increase in income in a certain proportion
Why save money, because it's savings — not income — that make you rich.
No one can get rich just by making more money, and wealth will only arise when you can keep the money. Many people mistakenly think, "As long as I can make a lot of money, things will get better." "But in reality, the standard of living always rises as your income rises, and your needs are always about the same as what you get." Therefore, without saving, you can only be in debt.
Although income has increased, two factors have not changed: the proportion of savings in net income and yourself.
So if you don't make enough money today, you still won't have enough money in the future, even if your income doubles, because the proportion of savings hasn't changed.
Save money from now on. Whatever predicament you are in right now, today is the easiest. So, starting today, save 10% of your net income.
Start with 10% of your salary, transfer it to a separate account, and use it to raise your geese.
The topic of savings has also been broken down in a separate chapter:
Why should we save money
Compared with "Puppy Money", this article introduces the recommendations for stock and fund investment in two separate chapters, which are not long but the words are pearls and the sentences are essential, which is worth reading repeatedly and reviewing and testing from time to time.
Investing in the stock market has prerequisites that must be followed, first of all, you should first strictly check yourself whether you have these necessary prerequisites:
You have to have enough cash You need self-discipline The stock market has to be fun enough for you The most important thing: Never put your old life into the stock market
10 Golden Rules for Stock Market Investing:
The first rule is that the stock market rises and falls alternately, there is no eternal rise, and there is no eternal decline; The second rule is to put long-term fishing for big fish, never put the funds that may be needed in the short term into the stock market, and when investing, we must ensure that there are 2 to 5 years to wait for the price to rise, so that the law of the stock market itself plays a role; Rule three buy at least 5 different stocks to diversify risk, from different industries and countries, but do not exceed 10 stocks; Before the fourth rule of law four sells the stock, the profit and loss is inconclusive; Rule five profits come from stock price increases and dividends; The Law Six Crash gives you the opportunity to eat at a low price; Rule Seven, Don't Conform to the Crowd; Rule eight, seize the opportunity, rational decision-making, avoid emotional matters; Rule Nine invest with your own capital and never borrow money to enter the market; Law Ten stocks always trump money, and will continue to do so in the future, and inflation damages the value of money but benefits stocks.
The stock market win-all strategy "King's Way" – considering only blue-chip stocks and targeting only industry leaders in each sector – is particularly suitable for conservative investors:
1. Heavy quality and strength 2. Focus on combination 3. Leave room for manoeuvre 4. Adhere to, make up positions and make profits 5. Money and patience
10 Tips for Investment Funds:
1. Ignore newspaper reports. 2. There will always be a trough in the market. 3. Avoid unnecessary turnover costs. 4, do not keep counting. 5. Remember that there is summer after winter, and there is winter after summer. 6. Trust the fund management company. 7. Buy regularly and forget the best time. 8. Invest in a market with high economic growth. 9. Write down the reasons why you chose certain specific funds. 10. Don't forget to diversify your risks.
Your income is determined by the interplay of 5 factors:
ability energy Influence Self-evaluation originality
Among them, each item is between 1 point (poor) to 10 points (excellent), but it should be noted that the impact score range is 1 point to 100 points.
For example: your ability score is 5, your energy score is 10, your influence is 3, your self-evaluation is 6 and a half, your creativity is 6, and multiplying these together gives you a total score of 5400. If your impact score is increased to 30 points, the total score will reach 54,000 points (monthly income)
In today's world where traffic is king, even if the other four items are OK, but there is not enough influence, it is difficult to have a high score, so the increase in influence has a geometric impact on your income level.
To increase your income, increasing your influence on your work is the most effective, of course, the most difficult, but also to upgrade other sections, so start by improving yourself.
That is, as mentioned earlier, saving, not increasing your income, can make you rich.
It's a long road and we have to put in 110% of our efforts and do it.
Don't be afraid of problems, don't be afraid of making mistakes.
We should not be people who never make mistakes, but people who never give up.
Zoom in on the target,
There are two kinds of people, both of whom know from the book that apples are good for health, and both know the saying 'one apple a day, the doctor stays away from me'. One of them says 'I need more background information,' and the other immediately goes to a nearby fruit shop to sell fruit.
The phrase "knowledge is power" is not exact. The right thing to say is that "applied knowledge is power." "So, you have to think right away about what kind of power you want to have.
Execution is sometimes more important than inquiry. Financial management is always necessary, as long as you have an economic connection with the world, not to mention you still want freedom.
I hope that everyone can have freedom, and I hope that we can all come to the end of this path of financial freedom.
Of course, this road cannot be smooth sailing, the future is destined to be full of thorns, then let me cut through the thorns, hot and go!
Thank you for your patience in reading.
Thank you~