How the Average American Can Become Financially Independent

“Financially independent” is not a term that is commonly associated with the average American. In fact, according to the latest statistics on US personal finances, a better descriptor would be “deep in debt,” “broke,” or “living paycheck to paycheck.” For many Americans, financial independence has become the most elusive component of the American Dream.

Steve Davis, CEO of Total Wealth Academy, has spent three decades helping Americans, as well as those outside of the US, become financially independent. Through his Total Wealth Academy, which teaches people how to build a second stream of income with active and passive real estate investment, Steve has trained hundreds of thousands of people seeking a practical path to financial empowerment.

Adopting a mindset that empowers financial independence

One of the things Steve has learned from his own journey to financial independence, as well as from watching thousands of his students become successful, is the importance that mindset plays in achieving wealth.

“You have to believe you can do it. If you have self doubt, you are never going to get there,” Steve explains. “Self doubt will keep you from even taking the first step. If you don’t first believe that you are capable of becoming financially independent, you will never take action.”

This understanding has led Steve to fashion his teaching approach to focus just as much time on personal development as on financial development.

“People who truly want to move into a place of financial independence need to work on themselves as much as they need to work on money,” Steve says. “That’s why 50 percent of our classes at Total Wealth Academy are on self development.”

Part of the self development that Steve brings to his students is an understanding of the importance of establishing a healthy work-life balance. Too often people ignore the damaging side effects that overworking has on their lives. Steve’s vision for his students is not just wealth, but also a more joyful and balanced life.

“It actually is very easy to get rich,” Steve says. “Just sacrifice your family, sacrifice your fitness, and avoid giving anything to charity. What is difficult is getting rich while maintaining a wonderful and passionate marriage, raising incredible kids, staying fit, and being involved in charitable pursuits.”

Arriving at a sound definition of financial independence

Steve believes that most people have adopted a faulty definition of financial independence that keeps them frozen in fear.

“People are scared because they think financial independence means having $10 million in the bank. Then they do the math and figure out they can never have $10 million in the bank based on their income, so they feel hopeless,” Steve says. “What they don’t know is that financial independence is really about cash flow and not how much money you have in the bank. As soon as the cash flow from your investments meets and exceeds your wants and needs, then you are financially independent.”

Steve has discovered that $600,000, not $10 million, is much closer to the amount needed to achieve financial independence. With that amount of money to invest, he says anyone can obtain real estate investments that result in a $120,000 per year stream of income. Exactly how to do that is what Steve teaches at Total Wealth Academy.

Reducing financial risk with a second revenue stream

Financial risk is another challenging concept that Steve helps his students to understand on their journey to financial independence. A study released by Northwestern Mutual in late 2019 found that the majority of Americans are“risk-averse” when it comes to financial investing. More recent reports say the COVID-19 pandemic has left Americans even less likely to take financial risks. Steve has found that most people do not realize that they actually already have chosen to embrace a high-risk position.

“The first understanding people need to have is that having a job as your sole source of income is the highest risk position in the US,” Steve says. “Look at what happened during COVID. Look at what happened during the recession. Look at what happened after 911. People are avoiding the wrong things. They think that investing is risky, but it’s less risky than depending solely on a job. They think that owning real estate is risky, but it also is less risky than depending on a job.”

In general, Steve believes that the more educated someone becomes about investing, the more they are able to mitigate the risks involved. Still, he makes sure that his students understand that anything worth obtaining will require a certain degree of risk.

Passing healthy financial habits to the next generation

“One of my main motivations for helping my students is remembering how I had to watch my parents suffer through fear and insecurity because of their finances,” Steve shares. “Then at age 25, I was suffering financially just like they did. I realized that parents who live paycheck to paycheck and retire broke teach their kids to live paycheck to paycheck and retire broke.”

Steve offers as an illustration the oxygen masks that appear on a plane when there is a drop in cabin pressure. Parents are instructed to put the mask on themselves before attempting to help their child. Steve says it is the same with helping our children to be financially successful.

“It is an adult’s responsibility to excel financially so that they can pass on what they have learned to their kids,” he says. “You can’t just tell your kids to be successful financially; you need to show them how by doing it yourself.”

For those looking for a pathway to financial independence, Steve and Total Wealth Academy guide their students step-by-step through the real estate investing process. They provide a plan for developing a second revenue stream that anyone can learn, embrace, and employ.

“I will always remember one particular student who paid for his Academy membership with rolls of quarters,” Steve says. “When I asked him if he had any more money to invest, he told me that all he had was the $1.50 that he needed to take the bus home. After learning from us about how to invest in real estate, he ended up buying two dozen houses and becoming financially independent. He is proof that anyone can do this if they have the drive, the determination, and the belief.”

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