Financial freedom can mean different things to different people.

It could mean having the wealth to retire at 60 and pursue your lifelong dreams, whether that’s traveling the world or relocating abroad. Or, it might mean having the peace of mind that comes from working in a job you love, knowing you can slow down when you’re ready, free from the pressure of saving more for retirement or supporting younger generations.

If you’ve already retired, it could also mean maintaining your financial freedom by ensuring you stick to a sensible withdrawal rate. That way, you can be sure you have enough saved to achieve your retirement goals while also being prepared for potential future expenses, such as care costs.

In all cases, financial freedom means living life on your own terms and at your own pace. Achieving it doesn’t happen overnight, and you need a clear, well-defined plan to guide you.

Read on to discover five steps to help you achieve financial freedom.

1. Define your goals

Defining your goals is an important step in achieving financial freedom. After all, if you want to retire early and spend your time traveling the world, you’ll likely need a larger financial cushion than if you plan to work into your 70s and enjoy a more low-key retirement.

That’s why it’s a good idea to clarify your long-term goals as early as possible and give yourself a clear direction and target to work towards.

And remember, financial freedom isn’t just about funding your ideal lifestyle. It also involves planning the legacy you want to leave behind, making sure your beneficiaries are taken care of, and ensuring you and your partner have sufficient resources for potential later-life care.

So, a good first step in achieving financial freedom is to define your targets based on all these factors, and you can then see what adjustments you may need to make to ensure you reach them.

A financial planner can help in this process. They can work with you to create a plan based on your goals that also covers all potential future costs.

2. Manage your expenditure and avoid lifestyle creep

As you progress through your career, you will likely earn more as you become more experienced.

One of the key missteps to watch out for on your journey towards achieving financial freedom is “lifestyle creep”, which refers to the gradual increase in spending as your income rises.

Over time, lifestyle creep can undermine your long-term financial goals. This is especially true if your financial plan assumes a steady, gradual increase in earnings.

To avoid this, it’s important to set clear savings and investment goals. Consider creating a budget that aligns with both your income and long-term objectives. Automating contributions to your savings or investment accounts can also help you stay disciplined, ensuring your priorities are funded before discretionary spending.

You can read more about how to design a budget in our previous article on the topic.

As your income rises, you should also try to make the most of your allowances, such as pension contributions or ISAs, to ensure you maximise your efficiency.

Of course, you can enjoy a portion of your additional hard-earned income, but it’s a good idea to be mindful and intentional with your discretionary spending. By avoiding lifestyle creep, you can move steadily closer towards financial freedom as you progress in your career.

3. Build a long-term investment strategy

Achieving financial freedom is a marathon, not a sprint, and long-term investment returns will likely play a crucial role. That’s why it’s important to build an investment strategy tailored to your unique goals and risk tolerance.

For example, if you’re still many years away from achieving financial freedom, you may be able to take on more risk, knowing there’s time to recover from any market fluctuations along the way. On the other hand, if you’re nearing your goal, a more conservative approach may be better for protecting the wealth you’ve built.

A well-diversified portfolio is also key. By spreading investments across different markets, you can both manage risk and open yourself up to wider gains.

By staying focused on the long term, you may also benefit from compounding and earn returns not just on your original investment, but also on the returns they generate over time. Given enough time, you might even reach the “compound investment tipping point”, where your investment returns surpass your total contributions.

You can read more about this in our previous article on the topic.

A financial planner can help you create a long-term investment strategy that protects your holdings, captures growth opportunities, and maximises returns, all of which could be crucial in helping you achieve financial freedom.

4. Review your progress

Over time, small shifts in your spending habits, unexpected life changes, or market fluctuations can cause your trajectory to drift. That’s why it’s important to review your progress once a year to ensure you’re still on track.

During these check-ins, you could ask yourself:

  • Are your investments still aligned with your risk tolerance and time horizon?
  • Has your spending crept up without you noticing?
  • Are you taking advantage of opportunities to save more, reduce debt, or invest wisely?

If you notice you’ve veered off course, don’t panic, just adjust. Minor corrections, made early, are far easier and more effective than drastic changes later on.

5. Speak to a financial planner

Achieving financial freedom takes work and dedication, and even then, it can be difficult to navigate the journey alone, but that’s where a financial planner can help.

They’ll help you define your goals, making sure nothing important is overlooked, and they can use tools like cashflow modelling to translate your ambitions into concrete numbers. From there, they can assist in building a realistic savings and budgeting plan tailored to your lifestyle and goals.

A financial planner can also design an investment strategy aligned with your risk tolerance and time horizon, and then guide you in making adjustments as your circumstances or the markets evolve.

They can help you stay on track, make informed decisions, and move confidently toward your vision of financial freedom.

To speak to a financial planner, get in touch.

Email info@perennialwealth.co.uk or call 0117 959 6499.

Risk warnings

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.

All information is correct at the time of writing and is subject to change in the future.

The Financial Conduct Authority does not regulate estate planning or cashflow planning.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Approved by Best Practice IFA Group 10/06/2025