Learning about personal finance is only the first step.

The next step is to use it wisely to move along your financial journey and reach your goals.

There are 3 main stages along your journey: financial security, financial independence, and financial freedom.

Let’s talk about each of these stages, exploring their nuances to guide you on your journey toward financial bliss.

  1. Are you financially secure?

Financial security means that you have a stable, predictable income. You can cover your basic needs. You can even handle unexpected expenses without getting back to square one, thanks to adequate savings, an emergency fund that covers 3 to 6 months’ worth of living expenses, and proper insurance protection.

You have an investment portfolio. It may not be huge, but it’s a great start.

Your personal insurance policies include health, dental, vision, car, home, disability, umbrella, and life. On the practice side, you have the required insurance plans as well (fire, liability, property insurance, workers’ comp, business interruption, cyber protection, umbrella and business owner’s policy).

Financial security makes you (duh!) safe. It’s the bedrock of a solid financial plan. It allows you to weather unforeseen circumstances without putting yourself or your family at financial risk. 

It’s the stage we hope to help VFS members get to ASAP.

Building financial security is therefore a strong foundation, but it’s only the first step on your financial journey.

Let’s look at the second stage of your journey to the top

  1. Are you financially independent?

Financial independence goes one step further. Now you have accumulated enough financial assets and passive income to support your lifestyle without the need for active income.

Your financial resources cover your living expenses, allow you to reach your personal goals, and help maintain your standard of living without depending on a “typical” paycheck.

You now master earning, saving, budgeting, and investing. Your passive income supports every aspect of your current lifestyle.

Financial independence makes you (duh!) independent. You can chart your own path. You now have the flexibility to choose how you spend your time.

You can work as much or as little as you’d like, pursue entrepreneurial ventures, support charitable causes, and enjoy the finer things in life.

It’s the next step of your financial journey, en route to the 3rd step.

  1. Are you financially free?

Financial freedom represents the pinnacle of financial success. You have complete financial autonomy.

It goes beyond financial independence. It means that your passive income allows you to pursue your passions, dreams, and wildest goals without being limited by financial constraints.

You can take calculated risks, explore new opportunities, and take a dream vacation or a sabbatical. You have total financial control.

Financial freedom fully supports your ultimate dream lifestyle.

By planning carefully, saving diligently, following a discipline, and committing to lifelong learning, you can absolutely achieve financial security, then independence, and finally, freedom.

Phil Zeltzman, DVM, DACVS, CVJ, Fear Free Certified