Why Should You Be Financially Independent?

by Vinaya HS on June 12, 2008

in Finance

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Continuing yesterday’s thoughts on financial independence, I made a list of the whys – why should you be financially independent? What does being financially independent really translate to in your daily life?

Here’s what financial independence translates to me:

  1. Having no loans or debts means I don’t have to worry every second of the day about late fees and astronomical interest charges, repossession, foreclosure, mean letters and calls from lenders, debt recovery agents at my doorstep, et al.
  2. Having a sufficient emergency fund in place means I don’t have to come into work each day worrying about whether I will also come into work the next day. It lets me do my best on the job today. Our Information Technology (IT) jobs were pretty safe up to now; now, there’s no guarantee. Really.
  3. Having independent health and life insurance means I don’t have to worry in case something were to go wrong with me or with my dependents.

If you noticed, the recurring theme in all these statements is “I don’t have to worry” i.e. “freedom from worry.” That’s what I’d like to achieve through financial independence.

What do you think? Why do you want to be financially independent?




Thanks for reading this article. I'd love to hear your opinion. Please use the comments section below to share your thoughts. I frequently write new articles that also cover several other aspects of personal finance including credit cards, financial goals, health insurance, income tax, life insurance, mutual funds, retirement planning, and much more. You can Subscribe through Email and receive new articles directly in your Inbox or you can Subscribe through the RSS Feed and receive new articles in your feed reader.

{ 5 comments… read them below or add one }

Vinayak June 14, 2008 at 8:58 AM

How would you roll out something on your own at this stage if you are so averse to a loan (for gain)?….you are aware that the success of Reliance has always been due to shareholders’ investment -public money! I agree, you need to be finanicially prudent, but independent at this stage…is like you are talking as though you are retired!

Vinaya HS June 16, 2008 at 3:20 PM

Vinayak,

Great point.

I am not averse to taking loans. Just that my definition of financial independence includes having no loans. This is an ideal state. If a genuine situation does require me to opt for a loan, then I will do so.

Does this answer your point?

Vinayak June 20, 2008 at 6:34 PM

Yes it does:-)

Anoop July 1, 2008 at 4:00 PM

I agree with you mate, these loans are perennial, they never stop and stretch like an elastic band..Financial independence is the best, we can avail loans if we want to, if not should be avoided.

Anoop July 1, 2008 at 4:02 PM

Now my car loans will span for next 4 years, even though I never wanted to pay 4 years, im forced to do so, as I will be made to cough up more if Im paying the whole amount in 1 go..its not a good idea…

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