How to attain financial freedom?

I've repeatedly said this bordering a rhetoric that retirement is not about re-tiring. It's supposed to be a period of encapsulation relaxed life, little personal pursuits, chasing a few passions and enjoying overall a good life. This has been the traditional mindset while approaching retirement. I, now-a-days, encounter millennials who wish to retire early as they've got too much stress due to work. And when I quibble the productive loss of the individual's calibre and capacity, they say they could possibly work at their own terms.

When I further quiz, they would like to pre-close their housing loans, clear all their debts, build an enormous corpus as quickly as possible so that they could retire working. What I've realized is that many aspire to be financially independent than retiring. So, one might ask how's it different? Retirement is mostly age driven while financial independence isn't age-related. Of course, one might choose to retire any moment, that choice is financial independence. In retirement, the main vocation seizes and thus the income associated with it, while in the latter case, one mayn't be dependent at all on the income from their job/vocation, etc. as there are alternate proceeds of income is built in.

Going back to the point of financial freedom, it's about financial security against all or most vagaries of life, economic where whittle to face any crisis and lead a peaceful desired life. So, how do one secure this? The very intention is the first change that triggers the whole dominos. But one must be clear about what one wants to achieve through this and possibly define what's financial freedom is all about in their own terms. Hence, it could vary from what I perceive as financial independence.

While a good intention is half deed, action is crucial for the fructification of this intent. The action includes attack on various fronts on the current lifestyle. One should be aware of the expenses, the possible additional savings, sources of incremental income, reassessing how one looks at assets and leveraging the existing assets. Also, this needs an imposition of frugal mindset on the impulsive behaviour to curtail unnecessary expenses. This could be a bigger drain on an individual's prosperity.

For a balanced diet, we need to consume not just fiber, proteins but also a bit of fat and other nutrients. Similarly, asset allocation becomes critical in achieving a less volatile portfolio which would remain in good stead in volatile times. Most importantly, the very passive nature of the standby allows one to concentrate better and enjoy their vocation.

It also helps them to remain active and productive at their work, knowing at their back of mind that the contingency is well placed. Of course, one needs to be adequately insured against death, disease and disability which could otherwise derail the entire planning. This takes care of the dependents' needs in case of a worst-case event.

Moreover, if the secondary source could provide for the basic requirements (which are mostly sought out, at least, initially) then one is psychologically relieved from the notion of continuous work for a living. This thought allows one to feel liberated and hence enjoy the daily life while prepared to confront any challenges. Hope and wish this Independence Day sets each on their journey towards their financial freedom.

(The author is a co-founder of Wealocity, a wealth management firm and could be reached at knk@wealocity.com)