The Road To Freedom May Not Be Through Investing Or Saving
revelations and thoughts from a decade of work
Growing up in a lower middle-classed Asian family, my mother only saw 3 valid career possibilities — doctor, lawyer, or teacher. Be any of these and you’re guaranteed to live happily ever after. Much to the great disappointment of everyone, I became none of these things.
Freedom is more than just a job
When I was a kid, adults sold me the following equation:
Basically, if I could get myself a decent paying job, I’d be free. Looking back, it’s a very Rich Dad, Poor Dad mindset.
My mother grew up a child labor factory kid. My dad made it to junior high before becoming a chef. They only knew the common narratives — that education and working a high paying desk job will solve everything. Over the past decade of working, I’ve come to realize that the idea of freedom is much more complex and simple at the same time. When we think about becoming rich, we’re not thinking about the money itself. Rather, our thoughts are circling these few common things:
- daydreams about quitting the job we hate
- the ability to make purchases without worry
- take as many breaks or holidays as we need
- go on adventures without missing rent
- the ability to treat our children with clothes that fit and feed them as we should
When we think about becoming rich, we’re not thinking about wealth and assets. We’re thinking about freedom. And having money is part of the equation. But is freedom really that expensive? Or is our perception of freedom a symptom of something larger?
The great misconception
Getting into the NBA is akin to winning a financial lottery. Players sign massive deals that can lead to large sums of money in a short time. Yet, we often hear stories of players that lose it all.
Latrell Sprewell had an estimated $97 million to his name but lost it all in 3 years. Derrick Coleman had $91 million in earnings but filed for bankruptcy in 2010.
It’s the same story as lottery winners who win big but quickly return to nothing.
This happens because they don’t truly understand the relationship between freedom, happiness, and money.
Money can afford your physical freedoms such as shelter, food, and clothing. But after a certain point, upgrades to the latest Gucci and Prada belt won’t make a major difference to your internal happiness meter. It’s just another piece of clothing if you really look at it.
When we depend on an external source to supply our personal internal happiness, it will never be enough.
Money is a finite resource while happiness is a mental state that is often fleeting and in constant fluctuation. Most of the time, it’s a moving target, and it’s the pursuit that gives us the internal thrills.
What you’re really after is contentment.
And to achieve contentment, you need to figure out where the edge of your physical freedoms lie.
The levels of freedom
Over the years, my perception of freedom has evolved from a simple time for money trade to a faceted and leveled system that can be achieved with the help of money.
According to the psychologist Abraham Maslow in his 1943 paper “a theory of Human Motivation”, he places the hierarchy of needs into 3 categories — basic needs, psychological and self-fulfillment.
Once you have a certain amount of money, your basic needs such as shelter, food, and security can be easily met. For many of us, we’ve figured out how to achieve this in some form.
However, many of us are also never taught how to achieve the other two freedoms — psychological and self-fulfillment. Many of us become trapped in the first category through endless consumerism. It’s also the same trap that broke NBA players and lottery winners fall into. In part, it’s because we are constantly in search of the next step to happiness without understanding that there’s more to it than just owning more things.
Freedom comes with the ability to pursue happiness. While money helps, it does not and cannot completely define the journey.
The relationship between contentment, happiness, money, and freedom
Contentment, happiness, money, and freedom is often mistaken as being synonymous with one another. In reality, it is a strongly linked relationship that requires all four to co-exist in order for the others to thrive. Money buys a certain level of contentment, happiness, and freedom — but it is not an end-all.
Contentment is required to keep happiness in check. Freedom is the ability to do whatever you want. But ‘freedom’ to remain truly free, you need to be aware of the things that truly make you happy. This means your happiness is not bound by an external source such as approval from someone. Psychological freedom at its finest includes but is not limited to:
- the ability not the be affected by external critics and the ability to take feedback constructively
- not be affected by social opinion or the opinion of those you know
- caring too much about what other people think
- overthinking what you ought to be
Contentment is the boundaries that allow you to define what happiness looks like. When your happiness is attached to an external source, that source will never be content with whatever you do. This will lead to more spending in the pursuit of maintaining whatever high you get from your perception of how others view you.
Internally fueled happiness is the process of figuring out what makes you content is your ideal status quo scenario. The easiest way to figure this out is to observe your daydreams, strip away those that are influenced by external sources, and see what’s left.
The limitations between money and time
There is often a struggle to balance the act of selling your time in exchange for money. People who live paycheck to paycheck are just breaking even on the time and money relationship equation.
However, not everyone plays by this rule. Business owners and entrepreneurs are people to have figured out a system to externalize the process of trading time for money.
There are two ways to do it:
- create a product with an automated production line and sales funnel, or…
- create a service that requires minimum manual work
The common feature between the two is that they both require minimal trade of time from the owner once the system is set up. This leaves the owner/entrepreneur with time to improve the system or use the time however they like.
Creating systems that generate money is the ultimate decoupling of time from the money creation process.
Your day job may or may not free you
Not everyone is meant to be a business owner or entrepreneur. Some people are just content with what they’ve currently got and what their day job can afford them.
Being content with the traditional system is not a bad thing. The job may be high paying enough with the right time ratio balance for you to spend it on your personal happiness.
Not everyone can get a high-paying job off the bat and there is a limit on the number of them in existence.
Not everyone can get a high-paying job off the bat and there is a limit on the number of them in existence. Some career paths are salary capped.
As the economic inequalities widen, there are many people looking for early retirement and guarantees rather than spend 50 years working and trusting that the system will deliver a particular lifestyle as promised.
However, the definition of a job has changed in recent years, and more people than ever are jumping into the micro-entrepreneurship. They come in many forms, often starting off as part-timers and transition into full-time work when they have the system figured out. They are your freelancers, garage sale flippers, content creators, your YouTubers, your bloggers, live streamers, and podcasters.
Finding your freedom
Saving and investing your excess buys you time when your income gets short. It gives you a certain level of freedom to continue with your current happy equilibrium.
But before you can get there, you need to have enough left over to do so.
When there isn’t enough, the easiest solution is to make more. However, this is also one of the hardest conundrums.
Perhaps finding your true freedom is not figuring out which stock to invest in or where to put your money. Perhaps finding your true freedom is figuring out how and where to put your time in order to obtain the maximum return on money, happiness, and contentment.