For many, it remains a vague concept, often associated with being rich. Above all, it is a far more personal and nuanced idea than you might imagine, provided you define it before trying to reach it.
Breaking down the myth of financial freedom
Before trying to become financially free, it is worth looking at the picture you have of it. That picture often comes from social media, and it can lead you away from what you are really looking for.
What the term suggests (often wrongly)
On social media, financial freedom often comes down to a handful of images: a beach, a laptop, income that rolls in effortlessly. This spectacular version of the concept suggests there is only one possible path, made of passive income and retirement at 35. Appealing as it may look, this picture matches neither the reality of most people nor necessarily what everyone is looking for in life.
What it does not necessarily mean
Being financially free does not mean being rich. Nor does it mean stopping work overnight, or living solely on passive income. These widely shared images hide a far more nuanced reality: financial freedom can take a modest, realistic form, and still have just as powerful an impact on everyday life.
What financial freedom really means
Once the myth is set aside, what remains is a simpler and more useful definition. It comes down to three ideas: being able to choose, having a safety margin and seeing money as a tool.
The ability to choose with fewer financial constraints
Ultimately, defining your own financial freedom means identifying the point at which money stops being the only factor that dictates your decisions. Being able to accept a new job, turn down an opportunity that does not match your values, change your life or simply say no without money taking up all the space: that is the most useful and most concrete form of this financial autonomy.
The security that gives you room for manoeuvre
This freedom does not rest only on the size of your assets. It often starts with a simpler foundation: an emergency fund and a clear view of your financial situation. Without this reserve, the slightest unexpected event, a repair, a temporary job loss, a health problem, can force you to turn to credit or dip into savings meant for other plans.
According to the State Secretariat for Economic Affairs (SECO), unemployment benefit in Switzerland amounts to 70% or 80% of insured earnings, which in principle means your average salary over the last six months, depending on your personal situation. A reserve can therefore help absorb part of the drop in income during a period of unemployment.
On the other hand, a safety cushion suited to your situation can give you more scope to consider a change of job, launch a project or get through an unexpected event. It is not an investment meant to generate returns, it is a reserve for unexpected expenses. It should generally remain easy to access.
The size of this reserve depends on how stable your income is, your level of fixed costs, your family situation and the other sources of security available to you. Someone who is self-employed or whose income is irregular may, for example, want a larger margin.
What matters is not following a universal rule, but estimating this amount from your own expenses, then choosing a realistic way to build up the reserve gradually. The emergency fund comes before everything else among your first financial decisions.
Money as a tool, not an end in itself
Money can bring far more than the ability to consume. A sufficiently solid financial situation can also provide financial security, reduce certain sources of stress and give you more room for manoeuvre in your life choices.
From this perspective, money is not an end in itself. It is a tool serving a broader goal. So the key question is not only how much to build up, but for what kind of freedom. Answering it calls for genuine personal reflection, far more than a simple financial calculation.
How to build your own financial freedom
Financial freedom is rarely built in one go. It first requires knowing what you are looking for, then organising your personal finances step by step, securing each foundation before moving on to the next.
Define what freedom means for you
Before building anything, you need to know where you are heading. For some, financial freedom will look like the chance to reduce their working hours. For others, it will be the ability to change careers with more security, or simply to sleep without worrying about the next unexpected bill.
Taking the time to clarify this personal vision, even before talking about figures or strategy, stops you chasing a goal that does not match your own values, which is the whole question of aligning your money with your personal values. Two questions can help:
- What would you do differently if money were no longer the only constraint on your choices?
- How much would that cost, in concrete terms, each month or each year?
The main steps to move forward
Once this direction is set, the building follows a logical progression, where each step strengthens the next:
- Take stock of your current situation, in other words your income, your expenses and any debt.
- Build an emergency fund, calculated from your actual expenses rather than a generic figure.
- Pay off consumer debt first, such as a personal loan.
- Set up regular savings suited to what you can afford.
- Only then think about investing, according to your goals, your investment horizon and your risk tolerance.
Skipping a step is often tempting, especially the investing one. But each foundation you lay makes the next one more solid, including when you build financial freedom from scratch.
Financial freedom is a path, not a destination
There is no fixed finishing line where you could declare yourself financially free once and for all. This freedom is built decision after decision, and each one counts.
Understanding your spending better, creating a reserve, choosing a career plan in line with your priorities or simply knowing why you save: each of these steps widens your room for manoeuvre a little.
This progression ties in with a broader idea, that of financial sovereignty. In other words, understanding your situation well enough to take back control of your choices, and to stop urgency or comparison with others from always deciding for you.
Conclusion
Financial freedom is not reserved for people with substantial assets. It begins when you understand your situation better and can gradually make decisions that fit your needs, priorities and values more closely.
Remember the essentials. Being financially free is above all about being able to choose. This freedom rests first on a reserve for unexpected expenses. And it is built in a precise order, with investing coming last.
To take a first step today, write down in one sentence what financial freedom would mean for you.
It is not a finishing line. It is a direction.
To get started: the Academy's Foundations programme, free, helps you lay the groundwork for your financial freedom one step at a time, without rushing into investing.
To go further: the AdvisorOne Diagnostic takes a few minutes to show you where you stand, with no commitment.
FAQ
How much wealth do you need to be financially free?
There is no universal amount. The level of wealth you need depends on the lifestyle you are aiming for, your regular expenses and the degree of independence you want. Financial freedom is measured more by the balance between your needs and your available resources than by a fixed figure to reach.
Is financial freedom possible on an average salary?
Yes, it is possible to improve your financial security and independence across very different income levels. However, your income, fixed costs, family situation and cost of living directly affect how fast and how far you can progress. The aim is therefore not to follow a single model, but to gradually increase your room for manoeuvre from your own starting point.
Where do you start on the road to financial independence?
The first step is to get a clear view of your current situation. It can then make sense to gradually build a reserve for unexpected expenses, while taking into account any debt, your plans and your priorities. This foundation then lets you set up regular savings and, depending on your goals, horizon and risk profile, think about investing.
How do you know if you are on the right track?
There is no single indicator. You can look at how your savings are growing, your ability to absorb an unexpected expense, your level of debt and, above all, how well your finances match your goals. Reviewing your situation regularly lets you measure your progress and adjust your course. A growing reserve and shrinking debt, for example, are two encouraging signs.
Does financial freedom mean no longer working?
Not necessarily. For many, it means being able to choose their work, how they do it or their pace, without financial pressure being the only deciding factor. Some reduce their working hours, others change careers, and others keep the same job, but with more peace of mind.
⚠️ Important notice ⚠️
The information presented in this article is provided for purely informational and educational purposes. It does not in any way constitute a personalised recommendation, investment advice, an offer or a solicitation to buy or sell financial products.
Any investment decision should be made after a thorough analysis of your personal situation, your objectives and your risk profile, and may require the advice of an authorised financial adviser.
Past performance is no guarantee of future results. Investments involve risks, including the risk of capital loss.