My quest for financial independence

If you've never heard of 'financial independence' , you're probably thinking, "Huh, what's that?". It's quite simple really. If your passive income exceeds your living expenses, you're considered financially independent.

What's passive income? Passive income is any income that is not derived from a salary. If you work for someone and receive a salary each month, that's not passive income. Passive income is income you receive from your business and/or other investments.

For example, you may have a 9 to 5 job that pays $3000 a month. In addition to your salary you may receive $500 a month from an apartment that you rent to another person. That $500 is considered passive income. You may have invested in your brother's company and that generates an additional income of $1000 a month - that's also passive income. So your total passive income a month is $1500.

What is your monthly expenses? If your monthly expenses is $2500, you're not financially independent yet because your passive income is only $1500. But the moment your investments generate at least $2501 a month, you're considered financially independent.

There are various ways to generate passive income - start a business, invest in someone else's business, invest in real estate, invest in shares etc. The idea is to generate multiple streams of income - that is how you build wealth.

That's the basic idea of financial independence.

Wow... my first blog!

I guess I should start by writing a bit about myself so that you can make sense of my rantings later on. I'm an average Malaysian who was born and grew up there. Like many brainy people, I got myself a university education. Then I spent a few years abroad (on that part of the world called Europe) and did a lot of growing up while I was there. I finally came home because the weather (winter and I don't get along) and the bland food finally got to me.

Malaysia is definitely the most wonderful place on earth. Take my word on it. Those years abroad made me appreciate how wonderful Malaysia is. The mult-racial, multi-culture, multi-everything elements make Malaysia truly unique. Where else can you find such a unique blend of culture. Anyone who loves food should definitely visit (and stay) in Malaysia. How I miss Malaysian food when I was abroad!!!

Upon returning home, I found myself a job - like most normal people. I was quite happy doing what I was doing until all the office politics got to me. Anyone who has been an employee can surely relate to this.

I'm a book worm and I LOVE to read. While browsing the books in MPH one day, I came across Robert Kiyosaki's "Rich Dad, Poor Dad". That book changed my perspective of life and what I want to do. And so began my quest to be financially independent. More on that later.