Have you ever asked yourself, how much do you need to have financial freedom?

Well, that could be a wrong question to start with. There is often this misconception that having an abundance of money gives you said freedom. But the truth is financial freedom is much more than having money.


It’s the freedom to be who you really are and do what you really want in life. If you want to be financially-free, you need to become a different person than you are today and let go of whatever has held you back in the past.

Therefore, conventional wisdom will never lead you to financial freedom. There are three things you must know and it is likely nobody has told you about it.

You don’t need a lot of money to achieve financial freedom

This may sound insanely strange but it is true.

School taught us all the skills to make money without defining a life purpose first. We learn valuable knowledge to make a living, but not how to alter old paradigms.

You see, there are 3 stages towards financial freedom.

  1. Financial security
  2. Financial independence
  3. Financial freedom

It is easier to step on the treadmill but it is hard to come down. Once you are at financial security stage, you start to believe the justification of life is the wealth you have.

You will end up living your life the way which you think other people will desire. You will start to jeopardize your own life by borrowing the money you don’t have, buying the things you don’t need, just to impress the person you don’t even know.

If you can accept that you don’t need to own an aircraft before you can take a flight, why not believe that you don’t need million dollars to enjoy a financially free lifestyle?

Trust me, you don’t need $1.38 million before you can retire in Singapore. I encourage you to read this post here and probably it will help give you a new perspective.

Financial freedom is a non-linear process

Conventional wisdom defines wealth building a linear process. That is, you work after you graduate, earn good income, save a portion of it every month and hopefully the savings can last you long enough after you retire.

The fact is, the rich people in the world have figured out that you cannot build your wealth by savings and the money has to grow experientially. That is why 20% of the rich in the world still own 80% of the wealth.


Think about it, if you start working at age 25 and retire at age 55, you work for 30 years. But you also have another good 30 years of life after retirement.

How much do you need to save in 30 years to sustain 60 years’ life? Simple math will tell you, even without considering inflation, you need to save at least 50% of your income.

Have you?

Some people will tell you that you can invest and grow your money along the way. And that brings me to my next point.

You can’t grow your wealth if you haven’t created them

There are really three steps to build wealth, it is quite simple and intuitive, but most people only think in terms of one or two steps. Here are the 3 steps you need to do

  1. Create your wealth
  2. Grow your wealth
  3. Preserve your wealth

Create your wealth

Many people talk about creating wealth by investing. That is a lie.

To most people, majority of your wealth comes from working (some people are “lucky” by inheriting). If you earn $5,000/month now and with a 5% increment every year, you will earn nearly $4 million in your working life. Do you think any personal investment can fetch you this amount?

Grow your wealth

But if you stop here, you will never be financially free. It is like the sayings in the cartoon below, “money is like toilet paper, you may think you have a lot, but soon it will finish”.


You have to grow your wealth, as fast and early as possible.

Statistically speaking, there are only 3 effective ways to grow your wealth

  1. Investing in paper assets such as stocks and bonds
  2. Investing in real estate (your own home is not an investment)
  3. Owning your own business

The easiest way to start building your wealth is through investing in paper assets because of the small capital outlay, but to do this, you need to

  • Have discipline and persistence
  • Start early enough in your life to allow compound growth to work its magic.

Once you have your first pot of gold, you can invest in real estate or build your own business. Because of the leverage effect, that is the time your wealth start to grow exponentially.

Preserve your wealth

If you look back the 3 stage to financial freedom I talked about earlier, once you grow enough wealth, you are likely to be at the stage of Financial Independence.

In order to leap to Financial Freedom, you do not need to acquire more wealth, but to preserve your wealth. But this does not mean to leave money in the bank. You cannot build your financial freedom lifestyle by eroding your lifetime savings.

The secret of having a financial freedom life you want is to convert your wealth to Income Generating Assets (IGAs). In Singapore, high dividend stocksinvestment property or REITs are good examples of IGAs.


What changed my life was the advice from billionaire Philip Ng. He said, “The ironic thing about possession is that you don’t possess the possessions, the possessions possess you”.

No matter what assets you own, cash, house, gold, they are not wealth. We are merely stewards of these assets. Only after we convert them into future cash flows and replace our needs to earn income, we have the means to sustain a life long financial freedom.

Over to you…

So here you have it, these are the three things that nobody talks about but essential for you to start on the right path towards financial freedom.

  1. You can start your financial freedom life today
  2. You have to design a non-linear wealth building process
  3. You have to create, grow and preserve your wealth.

Bob Proctor said, “Thoughts become things. If you see it in your mind, you will hold it in your hand.”


The first action to your financial freedom is to have the rich mindset.

You need to reorganize your thoughts and define your life mission. I challenge you to read this post and define your own personal mission statement for life.

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About the Author

Ivan Guan is the author of the popular book "FIRE Your Retirement". He is an independent financial adviser with more than a decade of knowledge and experience in providing financial advisory services to both individuals and businesses. He specializes in investment planning and portfolio management for early retirement. His blog provides practical financial tips, strategies and resources to help people achieve financial freedom. Follow his Telegram Channel to join the FIRE community.
The views and opinions expressed in this article are those of the author. This does not reflect the official position of any agency, organization, employer or company. Refer to full disclaimers here.

  • Hi Ivan, i happen to know you from social media and you can address me as Mr Ong, i am currently searching for a suitable Financial Consultant who could provide me the financial advice helping me to achieve financial freedom. Just for info, i have been investing heavily n stocks n mutual funds and have also faced several of financial pitfalls (wrong investment decision, resulting paper loss ) which i am stucked n puzzled on whether my current way of investing will able to help me sailing towards my financial gold – financial freedom. Hence, i needed some one who is capable enough to guide, advice n to restrategise my current way of investment. In short, i feel lost at this junction.

    And, for your info, i am not a rich man but with an average whitecollar salary income based person. Thus, i am not sure if your service includes middle income range. If yes, may i ask how do you price or charge on your consultancy fee? Look forward to hear from you. Thanks

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