What is Financial Independence?

This manual makes one large assumption about the road to happiness: the freedom to choose your own path is the ultimate way to lead a happy life.

It's conventional wisdom to go to college, start a career, work for 40 years, and then retire. While certainly ever getting to retirement is a laudable goal, we believe that following this path blindly does not maximize one's happiness and fulfillment.

Even for those who love their career, there are times when taking a break or doing something different is what you need the most. There will be times when a lower paying job will make you happier. Others when you'll want to be able take a radically different life direction. Take a year-long trip to South America, take a few years off to start a family, finally start that business, found a non-profit, work for a political campaign, study a new subject.

At the end of the day, independence is the freedom to choose what's best for you. But following the conventional life plan above doesn't give you that freedom. Sure, you may live a more lavish lifestyle and seem more successful, but you won't be free to make decisions that support your happiness. You'll be locked down to making payments for expensive things and not being able to retire until late in life, when your body is wearing out and your mind is losing its sharpness.

Dark stuff right? Luckily, there's a different way to live your life and truly have the freedom to make these choices. That is, to achieve financial independence or FI. When exactly you've "achieved" it depends on your goals, but broadly speaking, it's when you can freely choose how you spend your time without having to depend on someone else for cash to survive. Once you have the freedom to choose, happiness is much more attainable.

Financial independence is achievable through 4 simple components:

  • Choosing a good career that's a good fit for you

  • Reducing your spending to the things that truly bring you happiness

  • Strategically paying off and avoiding debt

  • Investing as much as you can

Don't get overwhelmed! This section will ease you into these four components with the basics, followed by deep dives into each area. Remember, this is a manual and you don't have to master everything at once. We recommend focusing on the first two areas to get you in a good career and to take control of your spending. Then, focus on getting rid of debt and investing to make your money grow.