Charities – 5%

The financial growth and reward cycle doesn’t stop. One can lose the meaning of true happiness by not focusing on anything else besides working. You achieve your goals, but after experiencing a few moments of accomplishment and happiness, you go back to setting an even bigger target for yourself and working relentlessly towards it. Someone who doesn’t even know where his next meal will be coming from could be seen full of joy as opposed to a rich man sitting in his big office. Gaining success is different from fulfillment. You must chase a life that contains fulfillment.

Money really won’t make one happy. You must appreciate and learn to give back to those who are less fortunate than you. You will gain perspective this way and try to build towards a future filled with not only success but also an impact on the world itself.

This is the ideal model, but in reality, the majority of people spend nearly 80-100% on necessities. Spending this much means they are living beyond their means and they have to come down a few notches to a simpler lifestyle. This could allow you to set aside saved money for long-term investments.

The effective management of money is a habit you should develop if you want to achieve financial freedom in the future. Achieving financial freedom has little to do with the amount of income you make; it has more to do with your money management. You can take examples of stories about people winning the lottery but losing all their winning in just a few years. That is because they couldn’t manage it effectively. Financial Freedom will start taking effect if you can earn more than what you usually make. If you can manage what you currently have, only then you will be able to lead a sustained and balanced life.