Trust me! None of the good things are free in this universe, with the exception of the bounties of nature. There is always a price to pay, which may or may not be in monetary terms but may be in some other terms that may not be very apparent. The laws of the universe are such that to get something, something else must be given. The universe always seeks balance. For example, scientific laws also state that energy can neither be created nor be destroyed but can only be transformed from one form to another (Law of thermodynamics). You cannot create something from nothing. In our case, to achieve financial freedom we must pay with your efforts of acquiring knowledge, practical experience, and appropriate mind set. This brings me to the three absolute necessities that are required to achieve financial freedom – DETERMINATION, DEDICATION and DISCIPLINE.
The three ‘D’s mentioned above are also the ingredients for success in any walk of life. Without these it becomes very difficult to achieve the goal of financial freedom in the long run. As you may have already seen in the previous post, that financial freedom was achieved only in the 14th year after consistently growing at an average rate of 3% month after month. Of course, if you had started with a larger capital and/or a higher average monthly rate of return, then the goal would have been achieved sooner, still you would need the three ‘D’s to achieve the goal. Without them the consistency of the returns will fizzle out in the long run and financial freedom would be difficult to achieve.
Elaborating a bit on DETERMINATION and DEDICATION, if you think of your Financial Freedom as a tree that has grown and consistently bearing fruits (the Returns) for you, then DETERMINATION and DEDICATION are the soil and water that is absolutely required for your money(the seed) to become the tree. Proper time needs to be allocated for acquiring the right knowledge for a good duration of time from a good source. It takes 4 years to become an engineer, 5 years to become an MBBS, minimum 3 years for most other professions, so think of the time and efforts that one spends during these years just to acquire the degree and knowledge for these professions. So, naturally you would also need to spend good time and effort to become a knowledgeable and skilled professional in this field (even if your engagement is part-time in this field). There are no short cuts, trust me!
Our efforts to achieve the goal would require that we repeat the returns month after month consistently. This brings me to the third D – DISCIPLINE. If the first two D’s are soil and water, then the third D is the sunlight. Without sunlight, the tree would not grow properly and majestically as we want it to, and in our case the seed may just become a sapling and die before becoming a tree. To be more direct, this D is absolutely a necessity when we are practically participating in the markets to generate our returns. In fact, this D is so important that I will be writing couple of more posts in the future especially dedicated to this D as a lack of it has created many Icarus (The story of Icarus) in the markets world over.
In the next post, I will touch upon one of the financial instruments that will be central to our goal of Financial Freedom. It is the favorite instrument of two categories of market participants –
- The most profitable and professional financial market participants
- The biggest gamblers of the financial markets