For some, it means no longer needing to work. For others, it means traveling without limits. For many, it’s a concept that remains vague, often associated with the idea of being rich. In reality, financial freedom is far more personal and nuanced than it may seem — and the first step toward achieving it is defining what it means to you.
Deconstructing the myth of financial freedom
What financial freedom often brings to mind
On social media, "financial freedom" is often reduced to a handful of images: a beach, a laptop, income coming in effortlessly. This idealised version of financial freedom suggests that there is only one path: generating passive income and retiring at 35. While appealing, this image does not reflect the reality of most people — nor does it necessarily represent what everyone wants from life.
What it does not necessarily mean
Being financially free does not mean being rich. It does not mean quitting your job overnight, nor living exclusively on passive income. These widely circulated images mask a much more nuanced reality: financial freedom can look much more modest and realistic while still having a powerful impact on everyday life.
What financial freedom really means
The freedom to make choices with fewer financial constraints
Ultimately, financial freedom begins when money is no longer the only factor shaping your decisions. Being able to accept a new job, turn down an opportunity that does not align with your values, make a major life change, or simply say no without money being the deciding factor — this is financial freedom in one of its most practical forms.
The security that allows for flexibility
Financial freedom does not depend solely on how much wealth you have. It often starts with a much simpler foundation: a solid emergency fund and a clear vision of your financial situation. Without a financial reserve, unexpected expenses can be much harder to absorb. Without one, an unexpected repair, a temporary loss of income or a health-related expense can quickly force you to take on debt or dip into savings intended for other goals.
According to the SECO, in Switzerland, unemployment benefits generally represent 70% or 80% of the insured earnings depending on personal circumstances. A financial reserve can therefore help absorb part of the income gap during a period of unemployment.
Conversely, a safety cushion tailored to your situation can provide more leeway to consider a job change, start a project, or simply navigate an unexpected event. It is not an investment primarily aimed at seeking returns: it is a reserve meant to cover unforeseen expenses. It should generally remain easily accessible and be placed in a manner consistent with its role as a safety reserve.
The amount of this reserve depends in particular on the stability of income, the level of expenses, family situation, and other available sources of security. A self-employed person or someone with an irregular income may, for example, want to maintain a larger financial buffer.
What matters is not to follow a universal rule, but to estimate the amount based on your own expenses and personal circumstances, and then to choose a realistic method to gradually build this reserve. A lack of structure at this stage can also lead to common financial mistakes, which we explore in our article on the 7 financial mistakes that can hold you back.
Money as a tool, not an end
Money can give you much more than the ability to spend. A strong financial foundation can provide security, reduce financial stress and give you greater freedom in the choices you make. Money, from this perspective, is not an end in itself. It is a tool serving a broader goal. The essential question is therefore not just how much to accumulate, but: freedom to do what? Answering this question requires genuine personal reflection, much more than a simple financial calculation.
How to build your own financial freedom
Defining what financial freedom means to you
Before you can build financial freedom, you need to know what you are working towards. For some, financial freedom will look like the ability to reduce their working hours. For others, it will be the capacity to change careers with more security, or simply to sleep without worrying about the next unexpected event. Taking the time to clarify this personal vision, even before discussing numbers or strategy, prevents one from chasing a goal that does not truly align with their own values.
The key steps to move forward
Once you have a clear direction, the path becomes more structured. Each step creates a stronger foundation for the next:
● Assess your current situation: income, expenses, any debts. This clarity allows for decisions to be made based on your actual situation.
● Build an emergency fund, calculated based on your actual expenses rather than a generic figure.
● Build a regular savings habit that fits your financial situation.
● Then consider investing based on your goals, time horizon and risk tolerance.
This is exactly the approach that Foundations, which is designed to help you build these financial foundations step by step, without rushing into investing before the essentials are in place. If you want to understand where you currently stand, our Financial diagnosis can help you assess your situation and identify the areas worth exploring further.
Financial freedom is a journey, not a destination
Financial freedom is built one decision at a time: understanding your expenses, building a financial buffer, choosing a career path that aligns with your priorities, or simply being clear about why you are saving.
This progression reflects a broader idea: financial autonomy. It means understanding your financial situation well enough to make informed choices, rather than letting urgency or comparison with others make those choices for you.
Conclusion
Financial freedom is not reserved for people with significant wealth. It begins when you understand your financial situation more clearly and can gradually make decisions that align with your needs, priorities and values.
FAQ
How much money do you need to be financially free?
There is no universal amount. The level of wealth required depends on the desired lifestyle, current expenses, and the degree of autonomy sought. Financial freedom depends less on reaching a specific number and more on whether your available resources can support the lifestyle and level of autonomy you want.
Can you achieve financial freedom on an average salary?
Yes, it is possible to improve one's level of security and financial autonomy with very different income levels. However, income, expenses, family situation, and cost of living directly influence the speed and extent of this progression. The goal is therefore not to follow a single model, but to gradually increase your financial flexibility based on their own situation.
How do you start working towards financial independence?
The first step is to get a clear view of your current situation. A sensible next step may be to gradually build an emergency fund while considering any debts, projects, and priorities. This foundation then allows for structuring regular savings and, depending on your goals, time horizon, and risk profile, to think about investing.
How do you know if you are on the right track?
There is not single indicator. You can look at whether your savings are growing, whether you can absorb unexpected expenses, how your debt is evolving and, most importantly, whether your finances are aligned with your goals. Regularly reassessing your situation allows you to measure the progress made and adjust your trajectory.
Does financial freedom mean you no longer have to work?
Not necessarily. For many people, it means having more choice over the work they do, how they do it and how much they work, without money being the only deciding factor.
Disclaimer
The information presented in this article is provided for informational and educational purposes only. It does not constitute personalised financial or investment advice, nor an offer or solicitation to buy or sell any financial product. Any financial decision should take into account your personal circumstances, goals and needs. Investments involve risk, and future returns are not guaranteed.