Financial independence and financial freedom are NOT names of similar terms. If a person wants to attain both there is a myriad of things that need to be done more precisely to retire comfortably. Financial independence is about generating cash flow, while financial freedom is often associated with being debt-free.
There are a lot of strategies that can be used to generate cash flow, usage of right kind of debts, or simply using your capital as an advantage so that you can enjoy your retirement. One of the key strategy is reduction of LVR in order to fund your property portfolio.
Reduction of LVR like anything else has its own set of cons and pros which can be minimized or maximized with a personalized approach on the basis of individual goals and the risk appetite.
To have financial freedom it is important that a person assesses and maximizes one’s property portfolio to align with the income goals. The need for a singular focus on property strategy and the potential pitfalls of trying to achieve multiple objectives with a single property is immensely important which can be done by developing a strategy, including setting tangible targets and assessing assets.
Professional guidance is recommended, especially when restructuring a property portfolio. It is always recommended that you seek professional guidance, such as from an accountant, finance broker, or property advisor, to make informed decisions and most importantly, never be afraid to remediate your property portfolio with your financial goals.
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Episode Highlights:
- 00:00 Welcome to Helpmebuy Property Podcast
- 04:22 Differentiating Financial Independence and Financial Freedom
- 07:46 The Strategy of Reducing LVR
- 19:35 Balancing Cash Flow and Capital Growth
- 39:05 Retirement and Passive Income
- 43:14 Key Considerations for Developing a Strategy
