More time. More independence. More opportunities.

For many people, financial freedom is a key goal in life—yet it means different things to different people. While some see it as never having to work again, others see it primarily as the freedom to decide for themselves how, when, and what they work for. However, the core is always the same: independence from a single source of income and the security of being able to cover your own living expenses in the long term without financial worries.

Definition: What does financial freedom mean?

Financial freedom describes the ability to cover your ongoing living expenses on a permanent basis from passive income or returns on your own assets.
This can mean:

• Income from investments such as stocks, ETFs, or bonds
• Rental income from real estate
• License fees, equity investments, or company profits

The key factor is that income no longer depends entirely on one's own working hours. Depending on lifestyle and risk profile, the amount required for this varies considerably.

Ways to achieve financial freedom

There are many ways to achieve this goal. Most successful strategies combine several approaches:

1. Saving & investing
   Those who regularly invest part of their income benefit from the compound interest effect. Even moderate returns can build up large fortunes over decades.
2. Passive sources of income
   These include dividends, rental income, royalties, or investment income.
3. Entrepreneurship
   Starting your own business can not only generate income, but also create assets that can be sold later.
4. Diversification
   Risks are reduced when capital is spread across different asset classes.

Success factors

• Start early – the longer the investment horizon, the stronger the compound interest effect.
• Set clear goals – how high are the monthly costs and what assets are needed to cover them?
• Risk management – sufficient liquidity reserves, broad diversification of investments.
• Continuous adjustment – life circumstances, markets, and goals change.

Risks and pitfalls

There are challenges lurking on the path to financial freedom:

• Inflation can reduce purchasing power.
• Wrong investment decisions or a lack of diversification increase risk.
• Consumption pressure and short-term thinking can jeopardize the plan.

Long-term discipline is crucial in order to cope with setbacks and stay on course.

The building block: impact investing

Financial freedom does not have to be a purely personal goal—it can also have positive effects on society and the environment.
Impact investing means investing capital in such a way that it generates financial returns while also bringing about measurable social or environmental change.

An example: DN Deutsche Nachhaltigkeit AG invests specifically in companies with sustainable solutions – from innovative environmental technologies to social business models. Such investments can be a useful component of a balanced asset strategy because they

• enable diversification,
• open up long-term growth opportunities
• and give your capital a dual purpose: wealth accumulation and sustainable impact.

Conclusion

Financial freedom is not an unattainable dream, but a plan with clear steps: save disciplinedly, invest wisely, manage risks, and seize opportunities. Those who also focus on impact investments combine the path to their own independence with the goal of making the world a better place – and reap double the benefits.