Hi, my name is Ka Hoe and I’m the founder of J Advisory and today I just want to share my thoughts with you on a conversation I just recently had with my friend and associate right because we were off the opinion or other I was off the opinion that Financial Freedom is such a bad word because of all the people who have continued to promote it and get people to go in their courses. I’m actually one of them but he is of the opinion that Financial Freedom if used rightly and understood rightly, you could actually set somebody free.
Now along in my conversation with another client, I recently did her retirement planning and this was the same question she asked me and because essentially there are two ways of how you retire and this is why I wanted to share with you this terminology right. Now the first way is you can actually retire using your net worth. So what does net worth means is that your asset minus your reliability is the balance the net balance, which we call it your net worth and why net worth is so important is I mentioned in my class a lot of time is that it’s something that you use when you retired and if you have too little of it basically, you have a very painful retirement or other you can’t stop working and to continue working and she was asking me is like hey you know, because of her income and she could find something passive right?
Can I retire on my cash worth which leads me to the second way of retiring so which is actually retiring using the cash flow. So when you are talking about retirement using your cash flow is essentially what Robert has been talking all about Robert Kiyosaki and he is talking about Financial Freedom, which means that your passive income is more than the expenses and over here as I explained to her in her business, which she’s able to generate cash flow from a business without her to be active. She was actually having something like 10,000 per month right. And right now she’s being able to generate something like six to seven thousand. She told me that she project by the end of this year, she could actually have you know, maybe 11,000 per month passive income and I was so happy for I congratulated her and I told her, this is exactly what Financial Freedom means and just for your information the first one where we talked about retiring by net worth, is actually what we call Financial Independence.
So naturally the first way is something easier to achieve and the second way is a bit more challenging right? How many of you are actually financially free? Do comment because I like to connect with you and we want to build a community of people who are financially free so that we can actually learn from each other and be able to share more personal finance to help more people right? I’ll see you next video.