Lessons Learned From Reaching Financial Freedom in Our Early 30s

Looking back on my life, I can pinpoint a few pivotal decisions that set me on the path to financial freedom. Thankfully, I have a husband who shares my mindset, and I believe that partnership was our "secret sauce." But whether you’re in a relationship or not, here are two key factors that laid the foundation for where we are today.

Self-Reliance

I’m not sure what initially sparked this mindset, but from a young age, I’ve been determined never to rely on Social Security or a company pension to fund my retirement. Since leaving high school, I’ve believed it’s my responsibility to provide for myself. Counting on external sources that I couldn’t control just didn’t sit well with me. This mindset was the first step on our financial journey.

Additional Income

To begin building wealth, you need money to start with—whether it’s your own or borrowed. When my husband and I got married, he had a small amount of savings (I was only 22, fresh out of college, and barely scraping by). Instead of upgrading our living situation—we were renting a one-bedroom apartment—we decided to invest his savings in a rental property to generate additional income.

Herein lies an important lesson: don’t inflate your lifestyle. Practice delayed gratification and focus on investments that will grow your wealth over time.

Our first rental property sometimes generated as little as $100 a month after unforeseen expenses, but some months we collected the full rent. Either way, the property was cash-flowing, giving us a profit every single month, no matter how small. This brings me to another lesson: real estate may not be for everyone, but if you want to generate additional income while holding a full-time job, choose something that creates residual income.

Unless you’re investing in T-bills or CDs, there’s really no such thing as “passive income.” A more accurate term is “residual income,” meaning income that isn’t directly tied to your working hours. In my opinion, that’s what you should aim for when building wealth.

We were also disciplined about not touching that rental income to upgrade our lifestyle. Instead, we set it aside until we had enough for a down payment on another property. That’s how our rental business started to grow. Money is like rabbits: it can multiply quickly if you let it.

Knowing When to Pivot

By the time the Great Financial Crisis hit in 2008, we had gained a solid understanding of the real estate market. Recognizing the signs, we exited the sector just before the crash. This move wasn’t just luck—it came from lessons learned along the way.

First, you must understand the asset class you’re investing in. Do your homework. Second, never fall in love with your investments. No matter how much we adored a home we had poured months into renovating, we never let emotions cloud our business decisions.

If your source of income is, for example, from affiliate marketing or network marketing, please remeber that you don't own this business. It is crucially important to use some of your earnings and make them work for you in other places, independent of your affiliate or network marketing company. Many affiliate marketers build a sizable business only to see it vanish before their eyes overnight.

Adapting With Age

Now that we’re older, we approach risk more cautiously. The reality is, we don’t have the same runway to recover from mistakes as we did in our 20s and 30s. This has taught us another crucial lesson: allocate enough funds to ensure a comfortable retirement. Build a financial firewall around your retirement fund as you near or enter retirement to protect what you’ve worked so hard to achieve.

Building a Foundation for Freedom

In my daily work, I help clients create tax-free wealth and guaranteed lifetime income. I help them establish the foundation that gives them the freedom to invest or start a business without jeopardizing their future. If you haven’t yet put safety measures in place, let’s talk.

Go to www.nadjadavidson.com and book your complimentary strategy session today. Together we’ll explore your current situation and goals. Let me help you create an environment that provides you with financial security so that you can swing for the fences with confidence.