The Life Skills You Need To Reach Financial Independence

For most of us, financial independence is no easy feat. It takes a great deal of hard work. And financial writer Trent Hamm points out that developing a few life skills are necessary for reaching this goal.

Money photo by Shutterstock Financial independence, Hamm explains, is being able to pursue whatever path you choose in life without dealing with financial worries. This independence allows you to make choices based on your personal satisfaction, not how much those choices pay.

In trying to reach this goal, Hamm realised there are a handful of characteristics that help make it happen. He calls it a "Swiss Army knife of life skills". Here are a few examples:

A willingness to learn: If I'm not willing to acquire new skills, the day I quit working at this job is the day I have a hard time finding meaningful work elsewhere that's above an entry-level position. That's not what I want to do, so I need to be willing to learn.

A willingness to do things myself: This spreads all throughout life, from preparing my own meals from scratch to fixing plumbing problems in my house. The more things I'm willing and able to do myself without calling for help, the more self-sufficient I am, the less money I need to spend, and the less likely I am to face emergencies which can undo financial balance.

These are just a couple of examples Hamm offers. Check out his article in full for more detail.

The Tools for Declaring Independence [The Simple Dollar]


Comments

    The more things I’m willing and able to do myself without calling for help, the more self-sufficient I am, the less money I need to spend, and the less likely I am to face emergencies which can undo financial balance.

    Yes, the more worldly you are, the more likely you will be able to take up opportunities and re-skill into more lucrative positions. Yes, you could learn double-entry accounting and never have to pay a bookkeeper again. HOWEVER - It pays to remember Adam Smith's theory of absolute advantage and David Ricardo's theory of comparative advantage. ... Don't forget the opportunity cost.

    If you have the capability to contract yourself out in your trade (for example) $150 per hour, it would be better for you to pay someone else $30 per hour to plant that garden/clean your house/keep your accounts up to date while you're out working for others, than it would be for you to be doing that job yourself.

    A willingness to delegate is the difference between a small business owner and a fortune 500 CEO.

      I agree completely. The art of delegation and outsourcing things that you don't need to do or don't want to do is a big part of achieving and maintaining financial independence. If we spent all our time working out how to do all this stuff you mentioned in your example, we would have no time to enjoy our lives and earn more money.

    From the title I was expecting an article with a list of actual skills that are needed for financial independence ei. 'You need to understand taxation' or 'You should have a clear understanding of how mortgages work' etc.
    Can someone else write that? I would read that.

    I reached Financial Independence at 50 yrs old (3 yrs ago). To achieve it, you really need to spend a lot less than you make or you need to build a company that will provide an exit strategy.

    Either way, you need to track your expenses closely, a free app that does this is Personal Capital (http://apple.co/1IqS2Hj). This will allow you to reduce your expenses once you see where your money is going.

    And what's saving for retirement without a little fun? I tracked my retirement date with a countdown app similar to this one: http://www.CountUsDown.com/Retirement).

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