Before I go on, I have to apologize first I don't have an easy to follow solution for this; not like Wealth Pyramid or Personal Finance in 1 picture. Because the answer was already given before this question is asked. And the ability to achieve financial freedom with dependents is really within you yourself as a person, not really a finance issue to start with. Give me a chance to explain ... because most people will not like this.
Through out the whole personal finance concept promoted in MalPF, it has never questioned you how you spent your money. As a matter of fact, the very first thing is to put aside some money systematically and then its up to you what you want to do; But you can only use up to what you have left. MalPF never question you buying that car, phone, liquor, smoke etc. MalPF just want you to do all those things within your means.
So systematically it doesn't really matter how you use your money, not even if they are for your dependents which is a much better cause than above examples. As long as you stay within your ability ( left over after saving ), your personal finance system should continue to work as is.
There are a few common mistakes we commit in practice ( real life );
- We treat our dependents as separate entities. While of course we are different people but since financially they depend on us, their expenses are really our expenses. All combined expenses should not exceed what we have left.
- We over reach our dependents needs. The fact that we 'allow' them to 'become' our dependents mean there are some emotion connection in between. This 'feeling' always get in to ways affecting our judgement what our dependents real needs are vs their wants.
- We ourselves fulfill our own luxury wants before our dependents needs. We can pamper ourself in whatever way we want but we should do it within our means. If there is no money left after settling our expenses ( including your dependents'), then we need to venture into solutions without money. ( There have already been stories shared before how things get done without money )
It was hinted before that young people who has expensive hobby don't get retire early, those who are more creative with their hobbies do. The hobby itself may be the same. Its the way they think about the hobby and what they do about it. Some think they have to BUY, the others try to GET/TRADE/DEAL however way they can come up with. Indirectly, they learn new skills that they can apply in other aspects of their life. Directly they full fill their own wants within their means - and hence did not need to scarify their personal finance system.
Although hobby and dependents are TOTALLY different in all aspects. But our reaction to them are actually similar or relevant. We were 'attracted' to do things beyond our means. If we do that in our early years we will end with less. If we first do it within a control manner (left over money), then perhaps we can do it more often and longer through out the journey.
Its NOT a matter of right or wrong. Its just that you can only choose one. If you decided to go beyond your means NOW for whatever reason, you should also be very satisfy with the price you pay in future. Or else don't BUY it!
Lastly be reminded that income is a pre-requisite in MalPF system. So no matter how you setup your ASS ( Automated Saving System ), increasing your income will increase the chance you can full fill your dependents and your Wants. So instead of letting dependents to push you to go beyond your means, why don't channel those drives into making more income !? Then you may be able to get the best of both worlds.
Ok, I apologized before. Now I have to do it again because I lied earlier. There are actually easy to follow actions you can do to still achieve financial freedom with dependents. But this article is more important than that and further more those easy to follow stuff may only be applicable to some people - and time travel starts to get in MalPF. Yea crazy I know! Thats why I didn't want to tell that story.
Relates stories :