Buying Back Your Time with Financial Freedom

Time is your most valuable asset. Unlike money, time can never be replenished or replaced. Once it’s gone it’s gone and there is nothing you can do to change that fact. This is why, for me personally at least, money is not the end goal for me on my quest to wealth. It’s the ability to use that money as a tool to buy back my time to do so as I please. This is the entire premise behind what financial freedom truly means and what it stands for. Instead of being a slave to your paycheck and trading your time for your money, living life optimally results from turning that equation upside down and trading money for your time. This happens when you generate enough passive income to live life on your ideal terms without having to physically work for a set amount of time to achieve that money.

Make money work for you instead of working for your money

In the book Rich Dad Poor Dad, by Robert Kiyosaki, Robert reiterates the theme of making money work for you over and over again. This idea was imprinted into my brain from that point on, and I instantly began the quest to recruit money to work for me. The problem was, at least initially, I didn’t have much of it! There will be a time that you will need to trade time for money, but the goal is to essentially eliminate yourself from the task of making more money and delegate that responsibility to the money you already have. For some time, I gained a decent nest egg of money selling real estate and learning the business. Now, I primarily focus on putting my money to work for me in investments. I even put other people’s money to work for me in the specific asset of real estate. The best thing about having money work for you is that unlike humans, money doesn’t have any needs such as rest, food, a social life, or time off. The more money you recruit to work for you, the more money that money produces! When you invest your money into an appreciating asset like real estate or the stock market, your money will grow to larger sums over time and pay you in what is called cashflow while you wait. For example, let’s say you purchase a $100,000 rental property you plan to rent for $1,200 a month. After taxes, insurance, and the mortgage if you choose to take out a loan, you may be left with anywhere from $400-$600 dollars a month. Out of that money, you should at least save half of it as a rainy day fund. That $200-$300 you are left with is called your cash flow. It may not seem like much, but it is consistent and passive income. The acquisition of new real estate is very repeatable especially if you stick in one market for a period of time. Within a few months to a year or two, you could very well have 10 rentals all providing you with this $200-$300 a month in cash flow which is equivalent to $2,000-$3,000 a month in passive income. For a lot of people, this type of money coming in passively is life-changing! All while this is happening, the real estate market is appreciating so now your home you bought for $100K 5-10 years ago is now worth $175K. That’s a 75% return in just a few years! Multiply that by 10 and you have a significant margin of equity. You can then either cash out and sell the properties, or refinance them to get ahold of some of that equity tax free and continue to keep your cash flowing assets.

Once you understand this concept, you’ll work as hard as you can for as short a period of time as you can to develop this system in which money takes your place in the workforce and works tirelessly to make sure you remain profitable! The stock market is another example of cash flow and appreciation. Instead of cash flow from rent, stocks often pay shareholders dividends, or percentages of their gains based on how much share they hold. This oftentimes happens quarterly and many people live off their dividend payments. This is all while the stock market continues to appreciate over time.

Setting up the systems to do as you please

The name of the game in terms of buying your time back is setting up the systems and processes to replace yourself. So many people complain about being employed by a corporation for example and want to go off and “be their own boss”. The problem with this is that oftentimes, these people go from employed working 40 hours a week to self-employed working 80 hours a week. They work in their business rather than working on it. The goal for everyone when they make an investment, start a business, or do anything in the pursuit of financial freedom is to come up with an exit strategy for themselves and replace their presence with people or money depending on whether it’s a business or an investment. Buying back your time is rather simple in principle, just very difficult to execute. If you understand the core principles of doing this from the beginning, there is no doubt that sooner rather than later you will be able to make money work for you instead of working for your money.