Most of us dream of achieving financial freedom — that moment when we don’t have to worry about how we’re going to pay the bills or make rent, when all our basic needs are provided for.
When there’s enough left to set aside for whatever we desire, whether that’s paying off debt, recreation, or a long vacation.
But what is financial freedom, really?
Simply put, financial freedom is having enough income coming in to not have to trade your time for money anymore.
Most people believe that working until you retire or getting rich is your best bet for becoming financially free. But being rich doesn’t necessarily mean you’re financially free. In fact, 95% of people have this misconception.
So today, I’m here to tell you there’s a better way.
And that way is by building yourself a stream or multiple streams of passive income that can pay for your expenses and more… without the need for constant, tiresome work.
In this article, you’ll learn:
- What passive income is and why it’s the best way to achieve financial freedom.
- How much money you need to be making to become financially free (in 2 simple steps).
Click here to jump straight to this section.
By the end of this article, you’ll be able to identify how to earn passive income and how much money you need to be earning passively in order to be financially free.
How Much Money Do You Need To Become Financially Free? Share on X
1. What Is Passive Income?
Passive income is exactly what it sounds like: Money that comes in whether you’re actively working or not.
It may sound strange at first, but it really does make a lot of sense.
There are two main ways to make passive income:
1. Investments working for you
The first major type of passive income is an idea most of us are familiar with already: investments.
These investments generally create monthly income with a fixed or standard rate of return attached to them.
This would include vehicles like bank and government bonds, corporate bonds, t-bills, rental property income, etc.
2. Business(es) working for you
The second type of passive income is the one that’s harder for most people to wrap their heads around: passive business income.
Many people assume that running a business means you need to be constantly working in order to achieve any real success. But that’s actually not true at all.
Instead, what you need to do is create a business that has the potential to be systemized so that it can work without you. That way, rain or shine, money will continue to flow in whether you’re putting in the hours or not.
The reality is that you want to have BOTH investments and business always working for you.
Watch this sneak peek video of my free video training, “The Fastrack To Freedom,“ and you’ll see why:
2. How Much Money Do You Need To Become Financially Free?
Now that you know what passive income is… How much money do you need to be earning passively in order to be financially free?
Read on to learn a simple formula to find out how much income you need to be earning from different passive income ideas in order to be financially free.
The first step is to take a look at your expenses…
Step 1 — Ask Yourself: What Are Your REAL Expenses?
Of course, passive income is only part of the puzzle. If you have passive income pouring in, but it doesn’t add up above and beyond your expenses, you’ll still never reach a state of financial freedom.
The other part is understanding your expenses and what’s actually essential in your life.
Why? Well, when we are talking about financial freedom, there are two ways to talk about.
The first is being free just to be free. This is when your passive income pays for only your basic needs, but not much extra (like all the extra luxuries in life).
Then the other way is where you are able to get whatever you want, when you want, and still not “have” to work.
The ultimate goal is the latter of the two, however, it’s a great first step when you have all your basic needs taken care of, yes or yes?!
So it’s best to create a list of your expenses that are necessities and a list of “nice to haves.”
You’ll notice when you do this, that it’s much easier to simply cut or simplify the non-essential expenses. You’ll begin to question whether you truly need them in your life.
Remember, even better than passive income, the best way to make money is to manage your money well.
The best way to make money is to manage your money well. Share on XLet’s move on to Step 2…
Step 2 — Calculate Your “Financial Freedom Number”
It comes down to simple math. The simplest way to do this is…
- Get an excel sheet or something similar
- List out your expenses (the necessities).
For example: rent, mortgage, utilities, food, debt/loans, insurance, prescriptions, doctors, kids care, pet care, phone, car, car gas (if it’s necessary), etc.
- Add up all your expenses
- Voila — you have your financial freedom number!
You’ll need to earn more than [INSERT YOUR EXPENSE NUMBER] in passive income to be financially free and have all your basic needs met.
Here’s a hypothetical example for you. Below is a list of expenses that totals $5,796.10 per month, with the financial freedom formula being:
Financial Freedom = Passive Income > Expenses
So, in this example, you’ll need to earn more than $5,796.10 in passive income to be financially free, yes or yes?
So now that you understand how much you need in passive income to be financially free, the next step is to figure out how to make it happen and take action!
Your road to financial freedom can take a very, very short time… if you know what you’re doing.
Want to discover exactly how I and thousands of others trained by me became financially free, and how you can become free, too?
Then attend my FREE video training called:
The Fastrack To Freedom:
“8 Critical Elements To Becoming Financially Free Quickly”
On this web class, you’ll learn:
- My new FreedomFirst formula so you never “have” to work again
- The ugly truth about why most people don’t become free, and how to beat the odds with a simple mindset shift
- A unique technique that could accelerate your path to freedom (You’ll be shocked at how simple it is!)…
And much, much more!
Click here to watch your FREE training. See you there!
What did you think about the article above? How much money do you feel you need to make to become financially free? Please share in the comments section below.
For Your Freedom,
UP NEXT:
How To Make Sure You’re On The Right Path To Financial Freedom
Hello – can you let me know what time zone the time slots for the Fastrack to Freedom webinar are in?
Also, can you let me know approximately how long the webinar is?
This way I can find a time slot that best works for me to attend.
Thanks!
Michelle,
There are plenty of times and days to choose from so you should have no trouble finding a time that works for you. The run time for the web class is a little over an hour. 🙂 If you need assistance please reach out to our team at support@harveker.com
Thank you – are the times listed in the Pacific Time Zone?
You can pick whatever timezone works for you. Once you click on the date you want the next step would be picking the time and then timezone 🙂
Hi Jesse
My name is Sandra and I think all you and Harv teach is spot on, I also agree with thinking Rich and Free are not the same, I’m self employed myself and see a lot of Rich people stuck in their own Business day in and day out, I don’t want to grow my Business and be stuck, I intend on learning from people like yourselves, then do it the right way, to be able to be Free then Rich off others who work for me instead… Great or Great…
UK Based…
Totally agree with you, Sandra! They are 2 different strategies. Your business can be your ticket to financial freedom though if you set it up to do so. 🙂
Harv talks about that in his class the Fastrack To Freedom. Thanks for being here and excited to see you around.
How much?
Hello Asif,
This is a FREE event! 🙂 If you have any questions please email our team at support@harveker.com
Harv, thanks for educating us. The online message has been very helpful to me. I am adjusting, unlearning my old belief and way of life as it concerns money.
The online teaching is best for us in Nigeria -Africa who cannot reserve our seat for your regular *free* lectures because of our loction
.Ani Augustine,
Abuja Nigeria
Hi,
Just letting you know, ever since you moved your web classes to the platform you use now. I can’t watch them and have to wait until you send the replay link.
My husband and I, always have big wow moments while listening to you. You truly are amazing!
Hi Cate,
Not sure why that’s happening. Is that location based? Have you contacted our support team at support@harveker.com so they can try and help?
We’d love to see if we can figure this out with you 🙂
Let us know.
Jesse
Hi any ideas for a chronic health condition person to create a passive income although not able to hold a regular job or be reliable enough to commit to a schedule? Something where this passive income can be generated from activity done on “good” days? SS disability income is not enough. Is there hope? The future of our countries’ social programs are at serious risk.
Hi Claudia,
Thanks for your comment. The goal of passive income is to earn money while you are not physically working. Now, of course, there is set up time and maintenance but this is not a regular work thing.
Take real estate for example. When you own a property and someone is paying you rent. The only work you need to do is collect the rent and maintain the house. That’s making money passively vs. activity,
I would suggest you join Harv on his class as I think it’s extremely informative on this whole process and can help answer lots of your questions!
My best,
Jesse
Buenas tardes, hay oportunidad de ver estas maravillosas clases en el idioma español?
Hello! Many thanks for the knowledge, wisdom and optimism that you give !!! I wish you happiness and prosperity! Regards!!
i need help where or how do I connect to you for WEB class???
Philippa, you can join here: http://bit.ly/FastrackToFreedom2018 if you are having trouble joining, please email our team at support@harveker.com 🙂
Will this fasttrack be replayed sometime soon? I have only now found out about it.
Gracias como siempre!
Woooow,,this is very enlightening,, I’m happy I read this article, it makes so much sense,how will I know which investment to take?,I will need about $4000 monthly to be financial free.
La herramienta me ha sido muy útil , porque me permitió aclarar cuando requiero para ser libre financiera mente, lo que implica que debo mejorar mis ingresos pasivos , he seguido sus lecciones y estoy logrando algunos cambios. por lo que estoy muy agradecida con la estrategias que nos dan y nos orientan.
un abrazo Sr. Harv
Just a glance at your article and chart brings sudden clarity to my chronic fearfulness and mental impoverishment over money issues. At a moment when the prospect of homelessness and financial jeopardy looms large, I am starting to see a path forward.. Thank you for the awesome simplicity of pure basics!
I will be studying and applying your information, as I begin to shed the threads of fear that have kept me from looking at money issues, without the terrifying shroud of doom.
Thank you Harv Eker for this wonderful easy to understand two steps to financial freedom.
j’ai besoin de 20740000 frcfa pour être financièrement libre.
Good day!
Very interesting topic. I calculated my “FF” number, I need $2,000.00 a month. I started using the jars method early February of this year. What a relief! The burden on my shoulders was lifted.
I want to learn more about invesments and passive income.
Thank you for today,
Anicia
Thank you T. Harv Eker for such valuable and easy to understand life concept!
That’s all folks!!! Congratulations T. Harv, this article is just Accurate.
Realy Realy impassive and help full.
Thank you sir
Dear Harv & Team:
I’m there, financially free, at last.
First read “Speedwealth” three years ago but poked around with different opportunities that didn’t clicked for me, last year took “Millionaire Mind Intensive” and “The Wealthy Marketer” so I set up my web based business, opened last March 2018 and it actually took only 3 months since the business started to be in this position.
I seriously couldn’t have done it without the 7 steps + the jars system + actually knowing something practical about marketing. If the business keeps at this rate, I’ll reach 7 figures in 3.5 years give or take but, since we’re building a brand and we have only sold our first not pricy product out of a catalog of 50+ (building the whole FEBE thing, you know 😉 ) I can confidently say that those 3.5 years might get cut in half, heck, even less if I seriously apply myself! Grrrr!
Life tastes waaaay better when you are free, for me it tastes like saying “Ohh, I wish I could do it but I’m running my own biz now, sorry.” to a former annoying client, or ordering off a menu without looking at the price, rather than instant noodles or hunger. But (real) jokes aside, like Earl Nightingale said it best, “Money? Yeah, lots of it, but the most important thing: you’ll have peace.” Yes, that “lump of anxiety” is gone for me now.
Readers, quit pondering and just go after your freedom, let no wall of granite intervene, just DO IT NOW! The rewards outweighs the sacrifices.
Thank you Harv, you’re doing great work in the world.
-A
Profound!
great stuff.
Thanks Harve and your team
Hi T I really appreciate your teachings but I would need 5-10 thou a month to be financially free
I have been working on my project for the last 5 years and have produced a high volume of exclusive design work; my passion and undoubted skill. Everything I have been advocating is now becoming a reality and I am actively trying to complete the sale of my work, with royalties paid on every meter of fabric produced. This will then revert to my family when I pass.. Survival has been my biggest concern whilst I bring this project to fruition. This will happen, please God before I go completely crazy.
Your article as always are incredibly helpful
Thank you,
Diane
Hi, I have a big problem mi English es very bad and my process y very slowly
Thank you for sharing . You are all awesome! I need to get cracking on my passive income at my young mature age ????. What about utilizing the internet? Writing and Publishing What are your thoughts?
Do work only, no money (can’t deposit)
excelente herramienta ya haré una mejor planificación de mis gastos reales y necesarios, en función de mis ingresos, reducir mis gastos e invertir, es decir menos gastos mas inversión.
This article is amazing and true life changing article. Is a big blessing being part of this team. More grace Harv.
I didn’t quite understand how calculating my expenses will make me do financially deee . All rhe same l THINK it ia making sense ro me now . Let’s go to the issue of making income more than my expenses.
This is wonderful training on financial education for entrepreneurs. I love it so much and I would like to hear it again and again without number.
Great article Harv, financial freedom is much closer than I thought. It really motivates me to research my options and take action to make my finacial freedom dream a fact.
Harvey, hi! My name is Daniel, I’m from Russia. From today, I start doing everything in my power to become a millionaire no later than December 5, 2018.
Believe in me.
You can write to me December 5 – “Daniel, you have earned your 1 000 000 rubles!!?” :)))
Let’s chat!
Very nice and practical Article to calculate the amount of money needed to be Financially Free and to start thinking out of the box on alternatives to generate passive income.
It’s a a beautiful guidance. Thank you Sir.
This is the most important lesson I have learnt today, I wish I knew this when I started working in my first job… I will be now far ahead in managing my money and achieving my financial freedom. Thank you for the insight.
hello Har, thank you so much for opening up my mind about this organization of life for success.However, I thought that when I cover the bills, that is financial independence and if no worry or fear about any of the expenses, that is financial freedom..
But how much is all about not on;y the number, may be the whole life style.
thank you
Good Morning,as,its still,the morning,this side of country(South Africa). It may sound very silly,but now,I undertstand what is passive income.How does one,calculate his passive income.
This is a great piece and I really enjoyed the article.
I will start implementing some of the things learnt here today to my life. I also believe that this is a good piece bcz it tells the difference BTW being rich and being free.
Thanks for this wonderful article.
Read your book and was well understood I loved it will be trying this for the first time in my life thanks for all the information you have shared it’s really appreciated
Hi there, what about the jar system for saving for children? What percentage would you advise of income should go in there? I would like to set up a savings account for each of my 2 children. I think if it is kept separately it will save confusion later on and can then take lump sum out and invest for that child etc? Or maybe there is a better alternative plan? Happy to be educated. Just trying to get my head round excel! Great system thank you. 🙂
I want to become an important person in life I want my words to change their views in general from all aspects of life in a direct way This dream and my goal in life and nothing in the world can affect the meanings that have within me life
I want to achieve my Financial Freedom in next 1 year. It may be… look impossible….
But- I want to believe to impossible to possible….
I need your guidance….I am 40 yrs. Single….not regular income….where should I invest to earn fast to achieve my Financial Freedom in 2020 before 15th January…its my birthday….when I will be 41st years old fast successful Billionaire of India.
I am very excited…to achieve it.