Getting rich is not simply to work hard but sometimes luck plays a huge part also. Smart choices and effort are important but things you cannot control usually have a huge impact.
For luck, you should be in the right place at the right time. For example, Bill Gates got lucky by going to a school that had a computer early on which helped him succeed.
Luck can create opportunities but it is unreliable. You can win a huge money by luck by playing Irish Lottery for tonight. But you cannot plan to be lucky. Luck matters but it is not good to depend on it.
Focus on what you can control like work hard, learn new skills and make smart financial choices. This will lead to financial success. If you want to know more about it, keep on reading.
Financial Freedom Vs Financial Independence
Financial independence means you can pay for your own life which cover bills, entertainment and future plans without depending on others like family. It is a big step towards self reliance but there is more.
Financial freedom goes beyond just covering costs. It is about having enough money to live the life you truly want without constantly worrying about finances. You can pursue your passions, traveling or simply enjoying more free time because money is not a barrier.
Financial independence is like the foundation but financial freedom is building your dream house on top of it. One covers your needs, the other unlocks limitless possibilities.
Does Luck Exist?
Just like the set for life lotto, luck is everywhere and it is simpler than you think. We are all a tiny part of a huge world and our actions are just a drop in the bucket compared to everything happening around us.
Most of the things in our life are out of control. Our lives are shaped by the actions of billions of other people every day. These actions bump into each other in unpredictable ways.
Sometimes, these events affect us directly which bring good or bad outcomes. That is luck. It is the result of countless interactions that we cannot control but can impact our lives in unexpected ways. Thus, we cannot predict luck but we can understand that it is a natural part of a world full of interconnected actions.
Examples of Luck in Personal Finance
External Events – Major events such as shifts in the housing market, global pandemics or wars can significantly impact personal finances.
Unexpected Opportunities – Being in the right place at the right time can provide opportunities that lead to financial success.
Accidental Timing – A huge mindset shift followed by massive action took place right before getting the first attending job can accelerate the path to financial freedom
How to Embrace Luck in Financial Planning?
Check out the ways below to embrace luck in financial planning.
- Create a Margin for Error: Increase the buffer between what you need to go right and what can go right in your financial plan to luck proof your financial future.
- Diversify Investments: Do not depend on one stock or sector. Try to Invest in the whole stock market with the use of index funds.
- Invest in Multiple Income Streams: Create multiple streams of income to ensure that if one is lost, you are still financially stable.
- Maintain an Emergency Fund: Always keep an emergency fund to handle unexpected situations.
- Balance Risk and Luck: Investors should consider both luck and risk when making decisions.
- Acknowledge the Impact of External Factors: Success depends on talent, effort, conditions, network and luck.
Other Ways to Achieve Financial Freedom
Have a look at other ways to get financial freedom below.
Know What You Want:
Figure out what financial freedom means to you. Write down those goals. It makes them real. Decide how much risk you are willing to take with your investments. If you do not like risk, stick to safer options.
Make a Budget:
Track where your money goes each month. A budget will help you spend less and save more.
Get Out of Debt:
Debt is a big obstacle to financial freedom. Pay off high interest debts like credit cards as soon as possible.
Keep an Eye on Your Credit Score:
A good credit score helps you get better interest rates on loans. Pay bills on time, check your credit report for errors and do not use too much of your available credit.
Start Investing:
Investing helps your money grow faster than just saving it. Learn about different investment options like stocks, bonds etc. and choose what matches your risk.
Prepare for Emergencies:
Build an emergency fund with worth of living expenses of 3 to 6 months. This fund is for unexpected costs like car repairs, medical bills or job loss.
Conclusion
Hard work is one of the reasons for financial freedom but sometimes luck plays a huge role too like to be in the right place at the right time. You cannot control luck but you can control your actions. Financial independence lets you cover your basic needs but financial freedom is to have the money to live the life you want. Also, focus on budgeting, getting out of debt, improving your credit score and investing wisely to pave your way to financial freedom.