Hey there! 👋

As I’ve mentioned in previous issues, my goal is to help aspiring entrepreneurs start their own business and, ultimately, escape your 9-to-5 job.

Every week, I share some tips, tricks, and methods that you can use to build a path toward independence. This week, we’re talking about a powerful concept: the Freedom Number.

Your Freedom Number is that specific monthly income amount that allows you to cover all your essential expenses and live comfortably.

Knowing this number gives you a target to work toward so you can confidently make the transition to full-time entrepreneurship.

What’s the Freedom Number? Your Key to Living on Your Terms

"Success is not having more, but needing less." - Socrates

The Freedom Number is the monthly amount you need to earn to cover your basic expenses, think rent, utilities, groceries, and a bit of savings.

Once you know this number, it becomes a tangible target for your side hustle income, giving you a clear financial goal to aim for before taking the leap.

Instead of feeling overwhelmed by the idea of replacing a full-time salary, the Freedom Number helps you focus on a realistic, achievable amount.

By breaking down the big goal of "financial independence" into a monthly target, the journey becomes much more manageable.

How to Calculate Your Freedom Number

Calculating your Freedom Number is straightforward. Here’s a simple guide:

1. Identify Your Essential Expenses: Write down everything you need to cover monthly rent, bills, groceries, loan payments, etc. Don’t forget to include some buffer for unexpected costs.
2. Add a “Freedom Fund” Buffer: Having a cushion for savings, travel, or occasional splurges makes your Freedom Number realistic. Aim for 10-20% extra for flexibility.
3. Account for Health and Emergency Savings: Depending on your location, health insurance and emergency funds are important to factor in. Think about your lifestyle needs and make sure your Freedom Number supports them sustainably.

Example:

If your essentials come to $2,500 a month and you add a 15% buffer, your Freedom Number would be about $2,875. That’s your monthly target. Hit it, and you’re well on your way to freedom!

Pro Tip: Track your progress monthly. Use a simple spreadsheet or app to monitor your side income and expenses. This will keep you aware of your progress and help identify areas where you can save more or earn more. Tracking keeps the target in sight.

How Top Entrepreneurs Calculated Their Freedom Number

Let’s look at a few inspiring entrepreneurs who have embraced this concept:

• Noah Kagan realized that he didn’t need a massive income to feel free. When he was first starting, Noah calculated that around $3,000 per month was his Freedom Number, the amount he needed to pay his bills, invest in his projects, and have flexibility. In Million Dollar Weekend, he describes setting realistic goals for side hustle income that allowed him to make strategic decisions on his path to full-time entrepreneurship.
• Ali Abdaal often discusses how he calculated his Freedom Number before leaving medicine to focus on YouTube and content creation. For Ali, his target was around £4,000 (about $5,000) per month to cover his London living expenses and give him the security to transition to full-time content creation. Ali emphasizes building “parallel streams” that support your target income, even if it takes years to reach. His advice? "Start small, build smart, and know when enough is enough."
• Tim Ferriss talks about “The Minimum Effective Dose” in The 4-Hour Workweek, where he emphasizes knowing your personal “enough.” Ferriss shares that his initial goal was around $2,000 per month to fund his lifestyle while he traveled and worked remotely. This strategy allowed him to live a flexible, experience-driven life while focusing on meaningful projects.

Pro Tip: Experiment with different income streams. Don’t rely on just one side hustle. Try a mix of freelance projects, content creation, or small investments. This diversification can make reaching your Freedom Number more attainable and give you a safety net if one source slows down

Take the Leap: What’s Your Freedom Number?

If you haven’t calculated yours yet, take some time this week to give it a go.

With a clear target in mind, you’ll feel more motivated and focused, knowing that every step you take is bringing you closer to a life of freedom. And remember, it’s not about being rich; it’s about creating a life that’s rich in purpose and aligned with your values.

So, what’s your Freedom Number?

Catch you next week!

Cheers, 🍻

‍