Investing Guides to Financial Freedom
Place of birth for “The Investing Guide and Road to Financial Freedom”.
This is good. It is 6.30 am on a Thursday morning. The sun is just rising and I’m thinking about my new project: writing “The Investing Guide and Road to Financial Freedom”. In the mornings I do my best thinking… especially when I am walking on a quiet beach with my feet in the sea.
Yesterday afternoon, my wife and I picked up our 6 year old daughter from school. We decided to go a few days to the coast. The schools are closed today and tomorrow. Just the schools, it is not a public holiday or so. Most other people are at work.
My work happens mostly at home. I’m my own boss and set my own hours. If I want to go on a weekday to the beach… now I can. A few years ago that was different. I worked for a boss and managed an organization. You required a few days of preparation to be able to go a few days away. And afterwards, the catching up took longer than the short holiday. Plus, it is no fun to be on the phone anyhow half the time when you are supposed to be with your family. Now it has all changed. This is how.
The key to the transformation in my life will be the topic of the stock market investing guide that I am going to write. Here in this article, you will get a preview of this guide. In summary, what I want to tell you is that when you save and invest your money wisely, also you can achieve your financial freedom.
The 3 Pillars of my Investing Guide
Here are the 3 pillars of my trend investing guide and the road to financial freedom:
- Save money
- Know your goal
- Invest simple
Let’s have look at each of these three individually.
Thus the first pillar for financial freedom is saving money. If you spend more than you earn, you will only end up in debt, poor or broke. If you spend all what you earn, you won’t make any progress either.
Saving money requires a certain mindset. Many people have the mindset of “this is what I want now and I’m going to get it”. That mindset will satisfy you only temporarily. It will not carry you to the next level. To save money, you want to think “this is what I really need know and that is what I want later”.
Thus, the first pillar is about living a frugal live, spend only what you need, save your money and keep your eyes on what you want in the future.
Know Your Goal
What is it that you want in the future? Let’s assume that you want financial freedom. What is financial freedom for you? Be specific when you try to answer this question for yourself. Here are a number of questions to think off. But, be warned. Financial freedom is way much more than a certain amount of money on your savings account… way more.
- What is more important to you, the “financial” or the “freedom”? Do you want freedom to get the financial or is the financial the way to get the freedom?
- Think also about the following two statements:
“A holiday is only a holiday if you work before it and if you work after it. “
“If you are like most people, you are the happiest when you can spend your time in a way that is productive and meaningful.”
Now what financial freedom would you like to achieve first:
“Having so much money that you never having to work anymore”
“Having the freedom to chose to do the work that gives you meaning and makes you happy”?
Thus, the second pillar of this investing guide is to know your goal. What is any guide worth, if you follow it but you do not recognize when you have achieved one of your prime goals. Think about it how sad it would be if you are chasing this ghost of “never having to work anymore” while you could have switched many years ago to do the work that you love to do.
Simple is good. The third pillar of my investing guide is to invest your savings simple. Why simple? Three reasons:
- Peace of mind
- Little time
- Focus on results
A good night sleep is not only something that you want; it is something that you need. No compromises here. Would you enjoy your life if the ups and downs in the stock market cause you to become a nervous wreck?
Ups and downs have happened, do happen and will happen again and again. There is no escape from this. The only solution is to accept and know how to deal with it. Later you will also learn how to capitalize on this.
But for your peace of mind, I guess that you want to have the insight and understanding of how your savings are invested… in good and in more difficult times. The only way for you to keep the oversight is to keep it simple. If you make it difficult, you will lose your sleep over it.
Two: Investing your savings is probably not your hobby. You rather spend your time with your family, doing sports, meeting friends etc. Of course you could try to grow your savings with complex stock trading concepts that keep you glued to your computer for many hours a week. If that is your thing, try this investing guide for penny stocks. But is that what you want? Does that give you a feeling of freedom? Not me. I don’t mind to spend an hour or two per month on investing and growing my savings, but that’s it. The only way to limit the hours that you need to spend on your finances… is to keep it simple.
The third reason to keep investing simple is that you want to focus on the long-term results. Investing is like managing an organization or a process. If you take your eyes too long of the ball, things will go wrong. The results of your investments need to be transparent if you want to manage them with ease. Therefore you want easy and reliable indicators that guide you in managing your money. Here it is again… keep it simple.
Before we move on, I want to stress the following. Only and only invest the money that you have saved and that you do not need in the coming years. How many years? Good question. That depends on in what type of assets you will invest your savings.
Road to Financial Freedom - Know Your Assets
The 8 major asset types that you could invest your money in are:
- Stocks (shares in companies) or funds that invest in stocks.
- Bonds (loans to corporations or governments) or funds that invest in bonds.
- Real estate (the property that you own) or funds that invest in real estate.
- Commodities (you probably do not buy large containers of orange juice or oil), but more likely the funds that invest in commodities.
- Precious metals or funds that invest in for example gold or silver.
- Foreign currencies.
- Others like art, diamonds etc.
In my investing guide we keep it simple. I suggest that you only invest your savings in assets that you understand thoroughly.
There is no need to invest in everything. I focus on the following:
- Investing in funds that invest in stocks.
- Investing in gold and gold funds.
- Keeping money in cash on your savings account.
- Taking the different currencies into account when spreading your investments internationally.
What you will not find in my stock investing guide (but I can link you to other sources for that) are:
- Short term stock trading systems
- Foreign exchange (FOREX) trading strategies
- Real estate investing, which is also a profession in itself.
Let’s focus on the long-term, limit our risk and keep it simple.
And where is this Investing Guide you may ask? Congratulations. You have found it. This blog and website here shows my road to Financial Freedom. To start, click here to sign up for my free investing newsletter. Enjoy the reading and enjoy the journey.