Financial independence means having enough wealth to enable you to stop working when YOU choose. It may mean having a mix of income producing assets such as property, savings and investments, and pension funds.
It is useful to know your Financial Independence Day, because it can reduce anxiety about the future and bring peace of mind.
When You Stop Working & Earning
To be financially independent, you need to look after yourself. When you stop working and earning you will need a replacement income. Building a Pension fund is one of the most tax efficient ways to provide you with an income in your later years.
Throughout your life journey, you may also have other income sources at that stage, such as a business, property, the state pension, so your pension fund will be a valuable and flexible part of that picture.
Converting Your Income into Wealth
The most valuable part of your income is the bit that you can do without, that you can set aside and save for the future in a Saving or Investment account.
Saving and investing for the future is an integral part of building your wealth, achieving your financial goals and ultimately Financial Independence.
Your Income is Probably Your Most Valuable Asset
Death or serious illness such as cancer, heart disease, stroke or an accident can strike at any time without warning. The financial effects can be devastating for a family. It is in these difficult situations that Life Insurance, Serious illness and Income protection insurances are so valuable.
Together, they provide money when it is needed most, at your most vulnerable time and ensures the family lifestyle can be maintained. It means that bills can continue to be paid, your children continue to have the opportunity to go to college in your absence, mortgage loans and other debts can be paid off thereby securing the family home or business assets.
Three Timeless Rules of Investing
Time & Patience. The probability of success in investing increases with time
Diversify your assets: Avoid putting too many eggs in the one basket
Accept the rough with the smooth: Market Volatility is normal and inevitable.
Teaching Someone to Fish
Providing for your children’s Education is probably the best gift you can give them in life.
Education gives them the means to have a good life and achieve financial independence in their own time.
Albert Einstein remarked that “Compound interest is the eighth wonder of the world, he who understands it earns it, he who does not understand it pays it”.
This is one of the reasons why taking a long term view is most important in investing and building a pension fund. Time is needed to allow compound interest to do its work.
Lifetime Financial Planning Ltd. trading as Lifetime Financial Planning is regulated by the Central Bank of Ireland.
Kells, Co. Meath.
Reg No: 181591
Directors & Contact Details
Michael Wall, Aidan Wall
Tel: 046 924 0961