Find out which stage of Financial Independence you are in and focus your effort on moving to the next stage.
The Four Stages of Financial Independence
Stage 1 – Get out of the Pit
When you are in Pit first thing you need to do to come out is to stop digging further in, seems common sense.
Not in terms of money, people take on more debt at even higher interest to repay previous debt and they just keep on digging the debt hole.
The underlying problem in this stage is people are spending more than they earn. So either earn more or spend less.
If both can be achieved i.e. earning more and spending less its a win win, will help you get your Financial Independence sooner than latter.
Stage 2 – Create Launch Pad
The stage where you are saving at least 10% of your annual income, no consumer debt, retiring your Education Loan. Have enough contingency fund.
You are adequately insured for your life. You have Medical Insurance if not covered by employer or government.
Stage 3 – Climb fast on the Independence Ladder
This stage is marked with you having high savings rates upwards of 30% of your annual income, Investing in products which has returns greater than GDP + Inflation.
Retiring the home loan.
Stage 4 – Set yourself Free
At this stage you no longer have to rely on actively earning to pay for your expenses. Your investment can take care of your needs.
As a thumb rule you are financially free when you saved upto 25 times of your annual expense. The multiple will change from person to person this is just guiding number.
It depends on how you will pursue your life post Financial Freedom, what is the inflation rate in country you Live, will your expense go up drastically etc.
You need to customize your savings accordingly, I am sure once you have achieved 25x you will be very capable to navigate the rest.
Where I am Currently:-
I am currently at Stage 3, saving approx 50% of my yearly income. Current Investment assets at 5x yearly expense, 90% in equities or equities linked products.
Have home loan which is very small compared to the home value and savings.
I have kept the home loan open for tax advantage, low interest and fact that I can earn more returns elsewhere rather than pre-paying the loan.
Actively thinking of selling the home and moving on Rent which will take my corpus to 20x yearly expense after paying off the loan and taxes. (Will write detail post on this topic)
Coming Soon:-
“Have you figured out what will you do post achieving your financial independence”
As I write this article I am also figuring out the same things, you are part of Live Journey to Financial Independence and it would be great to learn from my fellow travelers, and listen to them about their journey. Do like and comment. Share with others if you like it.
Thanks for being part of my Journey.
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Disclaimer:- Nothing on this site should ever be considered to be an advice, research or an invitation to buy or sell any securities
RichLife 
Congrats !! Nothing more beautiful than on bring path of financial independence and making sane choices. Are you following mf route or taking plunge in direct equity too.
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I started with mutual funds in last couple of years have moved mostly to direct equity, through PMS and own investments. MF is approx 5% of my equity exposure.
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