Forget Side Gigs: The Path to Financial Freedom Is Investing

Most of the time when people talk about side gigs, what they are talking about is creating more money to spend. Sure, in their mind they may be thinking this will get them ahead. But spending can never do that, and spending—at least at first—should not be the goal.

You need to invest your money if you ever want to create wealth and actually get ahead financially.

Even carrying a simple savings account is typically not enough since most regular savings accounts don't offer much in the way of interest. You should have savings, though. It is always important to have money that is easily and readily available if you have an emergency expense that needs to be paid like a furnace going out or a major car repair.

Typically, one should have at least six months' worth of salary in a savings account for emergency expenses which, by the way, also serves as a cushion if you lose your job.

One savings account I like that gives me a fair amount of access to my cash is from Ally. Because of the Fed interest rate hikes, they are now paying 4% interest, although it has fluctuated mostly between 0.50% and 2.5% over the years I have had the account.

Even when it paid only 0.50%, that was far above the typical interest offered on a regular bank savings account.

But even when it comes to investing, you can't just blindly enter the markets. That's a sure way to lose your hard earned, and even harder saved money. Learning about how to manage your money and invest it may just be one of the most important things in life you will learn.

Why?

Because while money can never buy happiness, what it can buy is freedom. And that's a big deal. Freedom is what gets you ahead and allows you to make decisions you want to, that are in your best interests rather than be forced to make decisions because you have little choice in the process.

Investing also accomplishes something else. It reduces your need to incur debt, which saves you tons of money in the long run. It allows you to better deal with things like inflation, that we are having to deal with now. It gives you room to breathe. It also gives you more time to do the things you want to do, rather than have to constantly chase more money—using your time to do it.

Those side gigs.

We hear all about them. Working in a retail store part time or delivering food through Doordash, walking dogs, renting out unused rooms in your house or your entire house on sites like VRBO. 

These things will create extra new money. But unless you are going to invest what you earn, ultimately these things are worthless, and all they will serve to do is eat up valuable time you could be enjoying doing other more fun things.

Things that can ultimately be paid for via the proceeds from your investments. Which brings me to just one more thing that investing offers. More spending money.

Granted, it's all calculated, right? You can't just spend willy-nilly. But certainly, if your investments are producing additional income, at least some of that additional income can be used to spend on the things you want. To treat yourself. To splurge a bit every once in a while.

Take a recent example from my own situation. I bought a camper to enjoy some time with my wife on weekends and when we can take extended weekends. I didn't pay for the camper. My investments paid for it. And my investments also pay for the trips we take.

My investments pay for dinners out or having dinner delivered when we want to do it. Having saved on the things we need we now have the ability to afford the things we want. We can do more. We have more free time. And it is likely we will retire rather early. We are in our 50's and seriously considering it.

We wouldn't be able to that had we not invested. We certainly couldn't do that if we had to spend our time doing side gigs. Especially if those side gigs were only to pay for things. To spend the money earned from them.

Overall, when you think of making more money, the aim—initially—should never be to spend more money. It should be to save more money. To reap the rewards down the line rather than upfront. 

Many people claim saving requires sacrificing living. It's actually the opposite of that. When you don't save, you sacrifice your life to constantly chasing new money the hard way to replace old money you spent.

Money makes money. And the more money you have, the less work you have to do get more of it.

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