1. Adequate passive income: passive income refers to income that can be obtained without direct labor, such as investment interest, dividends, rent, etc. The first criterion of financial freedom is to have enough passive income to cover your daily expenses and some extra expenses.
2. Adequate reserve fund: The second criterion of financial freedom is to have sufficient reserve fund. These reserve funds can be used to deal with sudden emergencies, such as unemployment, disease or large-scale natural disasters. It is generally suggested that the reserve fund should be able to pay for three to six months.
3. Healthy financial situation: The third criterion of financial freedom is to have a healthy financial situation. This includes not only stable passive income and sufficient reserve funds, but also positive investment income and gradually increasing net worth. At the same time, we should maintain good financial discipline, such as budgeting and regular savings.
4. Sustainable lifestyle: The fourth criterion of financial freedom is to have a sustainable lifestyle. This means that you can't spend more than your income, and you need to consider inflation and future living costs, such as medical care and pension. It is suggested that the living expenses should be taken as part of the financial planning to ensure the sustainability of your financial freedom.
5. Opportunities for self-realization: The fifth criterion of financial freedom is opportunities for self-realization. This means that you don't have to work for a living, but you can pursue your interests and dreams. This may mean that you should consider your future career planning and social life.
How to save money in daily life
1. Fixed deposit: This is a fixed deposit method, which can avoid the situation that you can't save money because of excessive consumption. For example, it is easier to insist on weekly or monthly time deposits.
2. Change deposit method: put some change into the piggy bank or bank account every day. This method can save a lot of money for a long time.
3. 12 deposit method: deposit a fixed amount into the deposit every month for one year, and then open a new deposit, so there will be a 12 time deposit one year later.