Financial Flexibility

There were a couple times during the last few weeks when I noticed what financial flexibility can mean in real life. What I mean by financial flexibility, is the ability to do whatever you want whenever you want and still be in a financial sound position. Of course, everyone thinks of retirement as the ultimate in financial flexibility, not having to work for “the man” anymore. There are other instances in which having financial flexibility can increase your net worth and may even bring retirement just a little sooner. Let’s take a look at some situations.


Now, this situation will not make you rich instantly, but it may enhance your enjoyment of life. Recently, I saw that Crystal from Budgeting in the Fun Stuff was taking advantage of a sale on a cruise. She received on advertisement from a cruise line she has used in the past for a phenomenal deal. She may not have been planning for the cruise, but the fact that she has positioned herself well financially enables her to take advantage of this offer. Again, this is not going to make someone rich, but it allows them to take advantage of a discount that they might not have been able to otherwise. By having vacation money set aside, you give yourself the financial flexibility to take advantage of a situation when a business is eager for your business.


I have seen a few articles recently, on blogs and newspapers, of investors taking advantage of the low cost of real estate. Since real estate prices are quite low, investors are able to buy properties at a reduced price, which enhances their overall return. By having the funds available, these investors are able to acquire properties and then rent them out long-term. Again, maybe this was something they were planning all along or maybe had not even considered until the returns became attractive. The point being they have the financial flexibility to take advantage of the opportunity when they see it.

The same can be said for the stock market in general. I apply a dollar-cost averaging approach to my investing. I have a set amount of money that I have budgeted every month that is transferred to my Vanguard account. I wished I had more financial flexibility the other week when the markets declined significantly. I believe that the market will over the long-term appreciate in value. So, when I saw values declining 3% or more, I saw it as a buying opportunity because I believe the market eventually will appreciate. As I said, I don’t quite have the flexibility to turn around and invest an additional chunk of money into the market, but I will.


As I said, I believe this is the ultimate in financial flexibility. However, when I think of retirement, I simply believe it is doing what I want. Now, that could be still working wherever it is I’m working. The difference is I am working there because I want to, not because I have to. My wife and I have talked a few times about how it would be fun to do this in retirement or do that in retirement. The only way we can do anything in retirement is by having the financial flexibility to do what we want, when we want to do it. How flexible are you?

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