It's crucial to understand the definitions and examples of vertical and horizontal income as well as your "Freedom Number" if you are going to live a Bucket List Life. My wish for you is a life where you can pursue your passions and live your Bucket List without worrying about finances.

Achieving financial freedom is a goal that many people aspire to, but few understand the path to getting there. In this blog post, I'll explore the concepts of vertical and horizontal income, active and passive income, and most importantly, calculating your "Freedom Number." 

Vertical vs. Horizontal Income

Before diving into the details, let's define the two primary income types: Vertical and Horizontal Income.

1. Vertical Income: This is income earned from traditional jobs or businesses, where you exchange time and effort for money. Vertical income can be active (e.g., a full-time job with a salary) or passive (e.g., owning a business that runs without your direct involvement).

Examples of Vertical Income:

• Active: Working as a software engineer for a tech company.

• Passive: Owning a restaurant and hiring a manager to handle daily operations.

2. Horizontal Income: This type of income is generated from investments or other sources that aren't directly related to the time and effort you put into work. Horizontal income can also be active (e.g., day trading stocks) or passive (e.g., earning dividends from a stock portfolio).

Examples of Horizontal Income:

• Active: Actively trading stocks or cryptocurrencies, spending time on research and decision-making.

• Passive: Investing in rental properties and earning income from tenants without actively managing the properties.

The Freedom Number: Unlocking Your Bucket List Life

Your "Freedom Number" is the amount of horizontal income you need to generate to cover your living expenses and enable you to live your Bucket List Life. It represents the financial threshold at which you no longer need to rely on vertical income to support your lifestyle.

Calculating your Freedom Number in 3 steps

1. List your monthly expenses: Start by determining your essential living expenses, including rent or mortgage, utilities, groceries, insurance, and any other regular costs. Don't forget to factor in discretionary spending for entertainment, travel, and other bucket list activities.
   

2. Determine your desired savings rate: Consider how much you want to save for future needs, such as retirement or emergency funds. This rate can be a percentage of your income or a fixed amount.
   

3. Calculate your Freedom Number: Add your monthly expenses and desired savings together. This total represents the monthly horizontal income you need to achieve financial freedom.
   
   For example, if your monthly expenses are $4,000 and you want to save an additional $1,000 per month, your Freedom Number would be $5,000 in monthly horizontal income.

I Want To Hear Yours

Achieving your version of your Bucket List Life starts with understanding the different types of income and calculating your Freedom Number. By focusing on generating passive horizontal income streams, you can work towards financial independence and a life where your time and energy are spent on the pursuits that truly matter to you. Start today by evaluating your financial situation, setting goals, and taking steps to increase your horizontal income to reach your Freedom Number.

Note: I love simplifying concepts like this so that my tribe (you) can get to where they want to get to in life in a shorter amount of time. So, I hope this helped. What's your mix of Vertical and Horizontal income and whats your Freedom Number?

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