10 Surprising Benefits of Creating Financial Freedom
What does financial freedom mean to you?
For years, I thought it was simply a dollar amount. And while I still have numbers tied to different levels of financial freedom, the concept has come to mean much more to me. As my husband, Jer, and I experienced different levels of freedom over the years, I began to realize it was more about the feeling and the way of life than it was about the actual money.
We live in a society where money is the medium of exchange. We all need a certain level of income to survive. Beyond survival, though, the greater financial margin we have, the easier some areas of life become. But that said, once we move beyond a certain level, studies show that more money doesn’t make us happier.
For me, financial freedom is about money. It’s about living debt-free, saving and investing, building assets, and spending on things that bring us joy.
But financial freedom also means not staying stuck in a job you hate because you need the paycheck. It's living with integrity because you’re not living in fear, scarcity, and lack. Financial freedom means not having to worry about the furnace going out, or fighting with your spouse when they purchase an outrageously priced flight to attend a funeral out of state. It's living a life of peace.
When you take control of your finances, you’ll enjoy less stress, better health, and a more peaceful work and home life. You’ll be able to do more of what you love and be free from worry and guilt. You'll have the margin to live a life that's authentic to you.
What would financial freedom mean to you? How would it feel? And how would your life look different 10 years from now if you made financial freedom a reality?
The Day it Happened
Jer and I got up extra early that sunny Saturday in May of 2014 to do something we never could have dreamed of until three years earlier. I remember feeling scared, nervous, and excited all at once. Once we had our coffee and cleaned up a bit, we drove to the closest branch of our local credit union. It was unexpectedly busy, and we stood in line for what felt like an eternity. We were so anxious that we didn’t utter one word to each other.
When it was our turn, we proceeded to the window, and the teller asked, “How can I help you today?” Not wanting to call attention to myself, I whispered, “We’d like to pay off our mortgage.” “Oh, that’s exciting,” she shrieked, “just go over there and I’ll send a banker right over to help you.”
Jer and I sat down and silently waited for the young banker. When the banker sat down, he confirmed that we were there to pay off our mortgage and wrote down the amount we owed on a piece of scratch paper. The pit in my stomach felt larger and heavier. What if something happened and we needed this money? Were we making a huge mistake?
Nope, I told my spiraling thoughts, this is what we came here to do. We’d been working toward this goal for years, and today was the day. I was going to bite the bullet and write the check.
In addition to making extra payments each month, we had been stashing our extra cash into a money market account over the previous three years. This was a large sum of money for us at that age, and so I triple-checked to ensure it was correct.
I held my breath and slowly handed the check to the banker. I prayed one last time that nothing would go wrong now that a big chunk of our safety net was gone. The banker entered a few notes into his computer and said, “Okay, you’re all set.”
The three of us stood up, and he shook our hands. Then he rang a bell and announced to the entire bank that “Holly and Jeremiah just paid off their mortgage.” Everyone clapped, and we humbly made our way back to the car. It was a surreal moment, to say the least.
Once in the car, Jer asked, “How does it feel?” “I don’t know,” I responded. “How do you feel?” I asked. “It’s weird,” he said, “hard to believe. It feels good, though—like a weight has been lifted off my shoulders.”
We grew up believing that debt is something you deal with until you die. You buy a starter house, upgrade to a bigger one, then a nicer one, and don’t forget the cars, furniture, and home improvements. Growing up poor, I longed to be wealthy for as long as I can remember. But it took us until our mid-thirties to realize we could get there with zero debt.
That One Day Changed Everything
We decided to pay off our mortgage three years earlier because we saw it as a way to get us closer to our long-term financial goals. We had no idea at the time, though, how it would change our entire lives. That one decision has become the foundation for much of what I coach and write about--building a foundation to do more of what you love. And this freedom eventually led me on a journey to find my true, authentic self outside.
First and foremost, I believe we need to feel healthy enough to have the energy to focus on the things that are important to us. Good health includes our bodies, minds, and spirits. When it comes to our health, our personal finances can affect our level of stress, as well as the food and activities we're able to afford. We like to try and compartmentalize our lives, but it is all inextricably connected.
We also need healthy and supportive relationships throughout our lives. This is especially important when you’re making significant changes in your life. Whether these changes are for your health or finances, find people who will cheer you on along the way.
The final piece of the journey is personal growth and lifelong learning. If you’re alive, you still have more to learn. I know that I am a different person than I was 20, 10, and even 2 years ago--I'm sure the same is true for you. The more I learn and grow, the more I realize there is to learn, and that's exciting. I have no idea what I'll be learning five years from now, but I know it will help shape me into the person I'm meant to be.
It probably makes the most sense to start with health. We, however, found ourselves focusing on financial freedom first. Our health became a priority not long after and remains one of my non-negotiables to this day. Healthy relationships followed, and personal growth has been a part of the entire journey. All of these areas of life are interconnected. I’m sure you will find that as you make progress in one area, you’ll simultaneously advance in others, too.
I feel I should also mention that our lives are not perfect by any means. It’s likely we connected through social media, and while I try to share my real life, I know it might look like I’m just showing my highlight reel. I consider that often and do my best to balance being real and keeping it positive.
The truth is that even though we have a certain level of financial freedom, we still have stress, worry, and other struggles. The difference is that the struggles we face today are very different than what they were 10 years ago. Since we’re working from a stronger foundation, today’s concerns are more growth-focused. It’s a fun and challenging place to be.
Having lived with and without debt, we wouldn’t choose to live any other way. There is nothing money can buy that could make me feel as good as financial freedom feels. Living debt-free has been an indescribable blessing to our life and our marriage. So without further ado, here are the top 10 ways financial freedom has changed our lives.
10 BENEFITS OF FINANCIAL FREEDOM
10 – YOU’LL BE FREE TO FOCUS ON WHAT YOU WANT TO DO, NOT WHAT YOU HAVE TO DO.
I once heard a psychologist talk about reframing the things you have to do as things you want to do. Research shows that people are more apt to stick to habits, like working out and eating healthy, if they view them as something they are choosing to do.
Since becoming debt-free, most of what we do, we choose. I don’t have to grow a garden. I choose to put in the work because we enjoy having nutrient-dense organic produce in our backyard. In our professional lives, we no longer feel stuck working in jobs or with customers who are not a good fit, just to make ends meet.
When you have debt, part of your life is going to revolve around doing what you need to do to make those payments. The more debt you have, the more stuck you feel.
When you’re not worried about making payments, you can set your life up to enjoy more of what you love each day. For most of us, those are the little things like going for a morning run, enjoying family dinners, or simply winding down with a good book after a fulfilling day of work.
9 – YOU’LL MAKE DECISIONS BASED ON LONG-TERM GOALS, NOT IMMEDIATE SURVIVAL.
The way Jer and I make decisions today is very different from how we made them as little as seven years ago. When we had big debt payments that were due each month, our tendency was not to rock the boat. We were focused on our short-term (false sense of) security. Above all else, we needed those next checks to come in.
Today, we look at things differently. Our timeframe for thinking, planning, and taking action has extended out much further. Conversations often begin with where we’d like to be five to ten years from now and what we need to do today to get there.
8 – YOU’LL IMPROVE YOUR RELATIONSHIP WITH MONEY AND SPENDING.
Other than politics, I can’t think of a subject that creates a more visceral reaction than money. It’s simply a medium of exchange. It’s a tool people use to build lives, businesses, and create change. But the topics of student loans, wages, and taxes make some of the most rational people fly off the handle.
As Jer and I have become more secure in our finances, we’ve changed how we experience money. We have less of an emotional attachment to money. We see it as a tool to create a life that’s authentic and meaningful to us. Not something that defines or controls us.
Our goal to pay down a large amount of debt quickly forced us to reframe how we see our wants versus needs. In 2013, we spent a mere $455 on clothes and shoes for both of us. During that journey, we discovered that very little of what we used to spend money on were things we actually cared about. Today, we choose to only spend money on things that bring us joy.
The most significant change, however, was learning not to care about impressing others. When I entered the working world after college, I thought the goal was to show how successful I was by wearing expensive clothes and driving a nice car (with payments, of course). When we purchased our most recent vehicle (with cash), we went with the most practical choice instead of buying something that would make me look like I “made it.”
7 – YOU’LL CHANGE YOUR PERSPECTIVE ABOUT SACRIFICE.
Come to think of it, I can’t remember the last time I made a sacrifice. Everything I do is a choice. How’s that for empowerment?
As I mentioned, we cut most of our spending during those three years we were paying down debt. And you know what? Those sacrifices weren’t as painful as we expected. In many cases, they were kind of fun.
Countless spending cuts that were meant to be temporary haven’t been added back to our current budget. We continue to camp because we enjoy it, not because it’s the cheapest way to vacation. We’ve come to prefer eating at home, and so our dining and entertainment budget hasn’t increased much. We found new ways to live life, and we’re enjoying every minute of it.
6 – YOU’LL HAVE MORE MONEY AND FINANCIAL PEACE.
Six months after becoming completely debt-free, Jer and I began making arrangements for me to leave my corporate job. The numbers worked out on paper, but I worried about losing my entire income. After I left, other things fell into place, but there was still a significant difference in our monthly income.
It didn’t take long to realize that even though we were making less, we were able to manage what was coming in better than when we made more and had more payments. It’s amazing what you can do with your income when you’re not using most of it to pay back the bank.
No matter who you are or how much you make, stuff happens! When you’re not spending most of your paycheck on payments, you can set some aside for unexpected expenses. When you need a new furnace, roof, or car, it’s a minor inconvenience instead of a financial disaster. This new way of being will bring you a greater sense of financial and emotional peace in your life.
5 – YOUR ACTIONS WILL ALIGN WITH YOUR VALUES.
When I had a “real job,” there were times I was told to do things that I knew were wrong. But since I needed to keep that income coming in, I felt I had to play along. As soon as we were no longer dependent on that job for survival, it was like a switch flipped.
I began to speak up in meetings and say, “We’re approaching this all wrong.” In case you’re wondering, that new voice was not well received. But it felt amazing to finally speak up about what I believed. Now I understand how living in resistance to our values is physically and emotionally exhausting.
Jer has expressed similar feelings. While discussing our newfound freedom, he said, “One of the best things is not feeling constant stress at work. I no longer feel trapped, and I don’t make decisions based on fear.”
When we’re stuck in the cycle of debt, it’s not uncommon to sacrifice what’s most important to us to make ends meet. I’ve been there and I now know that you don’t have to stay stuck. Freedom is closer than you think.
4 – YOU’LL VIEW YOUR FUTURE FROM A NEW PERSPECTIVE.
The plans we’re discussing for the next five to ten years weren’t imaginable when we started this journey a decade ago. In the past, we had big dreams but eventually were forced to face “reality.”
For instance, when we got married in Hawaii, we came back and announced that we were going to retire there. Everyone said, “There’s no way you’d be able to afford to live there.” And we believed them. Feeling defeated, we started looking for cheaper options, like Mexico, Nicaragua, and Thailand.
Today, we have a new perspective. Instead of accepting defeat, we ask, “What can we do to make this happen?”
With the freedom that comes from living debt-free, our dreams have grown far beyond retiring somewhere warm. Our dreams are no longer some far-off vision that will happen someday when we retire. Our dreams are continually growing and evolving, but more importantly, we believe that we can get there.
3 – YOU’LL ENJOY BETTER HEALTH.
I’ve shared the ways we feel less stressed, and there are other ways our health has improved. Most importantly, we’ve been able to take back control over how we live our everyday lives. We’ve built a foundation that allows both of us to exercise daily and consume healthy home-cooked meals. We’ve been able to work on rest and healthier morning routines. We drink less, sleep better, and live all-around healthier lives.
We also enjoy a greater sense of emotional peace. There’s less anxiety about making money. And we’re happier and more content overall. It’s been a much more fulfilling way to live life.
2 – YOU’LL FEEL MORE CONFIDENT.
This is a big one for both Jer and me. We struggled with low self-confidence for most of our lives.
In another blog post, I wrote, “Confidence is something we carry within us and not a series of particular behaviors. As we begin to feel more secure in ourselves and our abilities, our confidence will become visible on the outside in its own special way. Confidence is a skill. We can’t read, wish, or meditate ourselves into more confidence. We have to practice the things we’re trying to become more confident in.”
This confidence has spilled over into areas beyond our financial life. We’re more confident with our health, looks, and body image. We’re more confident in our relationships and communication. More confident in our careers and life choices. It was an unexpected yet welcome bonus to achieving financial freedom.
1 – YOU’LL ENJOY BETTER RELATIONSHIPS, ESPECIALLY WITH YOUR SPOUSE.
It’s hard to express what working on and achieving a goal like this does for a relationship.
Working on something like this as a couple requires a high level of honesty, follow-through, and trust. Your success depends on your ability to communicate and work as a team. If you can stick with it, achieving your goal will bring you closer together.
There are many ways our relationship has improved. We feel less stressed overall. We have more quality time together. And we continue to learn and grow as a team. This is something we will always share; the experience of a lifetime that brought us closer together.
I invite you to think about how these benefits could play a role in your life. Then take some time to think about what financial freedom might look like to you. I share our story, not as the only path to freedom, but to inspire you to write your own.
Here are some questions you might want to consider.
How much money would you need to reach the next level of financial freedom?
Does financial freedom mean living debt-free?
If so, how much debt do you have to pay off? How quickly can you do that?
How much would you need to earn to not have to worry about making ends meet?
How will you manage your finances in order to maintain your financial freedom?
Now, take some time to think about why this is important to you and your family.
Answer these questions and visualize the answers as though they’ve already come true.
How would your life be different if you created financial freedom?
How would your daily life be in better alignment with what you most value?
How would your relationships transform through this process?
How would it feel to achieve this goal?
How would you use your freedom to leave the world better than you found it?
Finally, there is no change without action.
Write down one small thing you can do this week to start moving toward more freedom.
Editor’s Note: This post was originally published in June of 2018. It has been completely revamped for accuracy, comprehensiveness, and readability. Please enjoy and feel free to share this newly revised content.