Many people want to achieve financial freedom but don't know how to do it. They read books, talk to professionals, get financial planning advice from financial planners, but never seem to make it happen.
The statistics are staggering when you look at who is retiring with what over the next 20 years. Why is this goal so illusive? What are people missing?
One of the major road blocks that keep people from achieving financial freedom is the misinformation that surrounds the question. Everyone has an opinion about how to do it and shares their information, or philosophy, on how to become financially free but most of the time its flawed.
One of the major flaws is that when anyone listens to a person who is a representative from the financial world they already have a hidden agenda, which is to get the peoples money and make a commission. Even if a financial person says they only charge a fee the fact is they will put the clients into a financial product and someone is getting a commission. Fee based advice is done because the planner wants to say they have no specific tie to anyone one financial institution, but truth be known, they are going to recommend that you use some financial institution otherwise they would not be in business.
The financial institutions must get your money and invest it, to be in business, so the financial person will direct you to some form of financial product. This is where the rub begins! When you use a financial product you put your money at risk and allow the financial institution to make money on it. They in turn will pay you a small amount of money for the use of your money. This is called Economic Rent. "What's the cheapest I can pay you for the use of your money?"
When markets go down the consumer bears all the risks since the financial institution is passing it all to the consumer. So lets recap, the consumer gets paid a little when money is made and the financial institution makes the lion share of the money, but when the markets go down the consumer bears all the downside risk. It hardly seems fair does it?
So listening to financial people might not be a great idea unless you know how to play by the rules of the financial institutions.