Hey, it's Sergio.
Every January, people talk about "new."
Starting a company. Going back to school. Taking a sabbatical to figure out what you actually want.
But here's the uncomfortable truth almost nobody says out loud:
You can't make bold, new moves in your life if your bank account is holding you hostage.
If your entire lifestyle depends on a paycheck hitting every two weeks, taking a big swing feels impossible. It's not that you don't have ideas on how to improve your happiness. It's that you don't have a runway.
This week, I want to talk about a concept I call a "Freedom Fund"—and how to build one.
What a Freedom Fund Actually Is
A Freedom Fund is money specifically set aside to cover your life while you're not working a normal full-time job.
It's separate from your emergency fund (for "car broke down, roof is leaking" moments).
It's separate from retirement accounts (designed for your 60s and beyond).
Your Freedom Fund exists so you can say:
"I'm taking 6–12 months off to build this company."
"I'm going back to school without panicking about rent."
"I'm switching careers, and I want a cushion while I ramp up."
You're not just saving money—you're buying permission to take a risk.
Figure Out Your Monthly "Freedom Number"
You can't build this fund if you don't know what it needs to cover.
Start with one question: How much does it really cost to be "you" for one month?
Add up:
Rent or mortgage · Utilities and internet · Groceries · Transportation · Health insurance · Debt payments · A small but honest amount for fun
Call that number your Monthly Freedom Number.
Example: If that adds up to $3,000/month and you want a 6-month runway, your target is $18,000.
Want a full year of freedom? $36,000.
Is that a big number? Probably. Is it impossible? No. You build it the same way you build anything meaningful: one automatic deposit at a time.
Invest It, Don't Just Save It
Here's what most people miss: even if you don't need your Freedom Fund right away, now is the best time to grow it.
The strategy is simple:
Take the money you're saving and invest most or all of it into a diversified mix of index funds and ETFs using a brokerage app like Robinhood, Schwab, or Fidelity.
This gives you the lowest-risk way to grow your money while it waits for you to use it.
When you're ready to step away from the 9–5, transfer a portion to a high-yield savings account and pull out money on an as-needed basis.
Why this works:
Your money keeps growing in the market while you only pull what you need. You're sustaining your savings while continuing to earn returns on what's still invested. It's not sitting in cash losing value to inflation—it's working for you the entire time.
Make It Automatic
Most people make one of two mistakes:
They only save in cash and lose ground to inflation.
Or they only invest aggressively and panic when the market drops.
Your Freedom Fund should use both—saving and investing—on autopilot.
Set up a recurring transfer every time you get paid. Even $100–$300 per check adds up over a year. Treat it like a non-negotiable bill, not a "nice to have when I remember."
Route that saved money into a diversified investment plan inside a regular brokerage account—something boring and broad like total market index funds or a mix of stock and bond ETFs. Not the latest hot stock or meme coin.
If you're 1–5+ years away from needing this money, keeping it invested in conservative, diversified funds helps you beat inflation and slowly grow the fund while keeping risk manageable.
Over multiple years, this is what turns "a pile of cash" into a growing financial engine that works quietly in the background thanks to compound interest.
Get Clear on What "Freedom" Means to You
A Freedom Fund isn't just a number in a spreadsheet. It's a bridge to something specific:
6 months to try freelancing
A year to build a startup
Time to go back to school or switch industries
Space to move cities and reset your life
The clearer you are about what you want this fund to do, the easier it is to stay disciplined.
When you're tempted to spend that extra $200 on something forgettable, it's not "just" $200 anymore. It's one more brick in the runway that lets you walk into your boss's office one day and say: "Thanks for everything. I'm going to go build something of my own now."
Start Small (Seriously)
If your brain is going, "Great idea, but I can barely save anything now," you're not alone.
A few realities:
Even $50–$100 a month is a start. The point is consistency, not perfection.
Raises, bonuses, tax refunds, and side hustle money are perfect candidates to dump straight into your Freedom Fund.
You don't have to hit the full target in one year. This can be a 2–5 year project that quietly transforms what's possible for you.
You will never regret having a year of living expenses saved and invested.
You might deeply regret letting another 5 years go by with no plan.
