For years, the concept of financial freedom has been elusive to many and achievable by few.
The idea that you can be financially independent for the rest of your life without working or depending on others is a relatively new concept, as the wage gap has widened over the years in billion-dollar terms. Now, it seems everyone is looking for ways to make more money that they can invest in additional income-generating ventures.
This doesn’t happen overnight, though, and it certainly doesn’t start without having disposable income to begin with. That’s one of many reasons why folks are turning to software engineering as a career path. The generous pay day and unmatched job security give these professionals the opportunity to achieve financial freedom over time.
Plus, with the current lack of available talent, companies are paying even more money for viable software engineers. You can see average salaries by city and level here, but the truth rings no matter where you are — software engineering is a lucrative career path. It’s also possible, when you invest your money in the right way, to achieve financial freedom through this career track.
Let’s first discuss why software engineers are more likely to achieve financial independence and success than other professions.
Why software engineers are likely to achieve financial freedom
Earning potential aside, software engineers all share a few common personality traits that make them not only great in their career, but more likely to achieve financial freedom.
Great software engineers, by nature, are natural problem solvers — especially when that includes thinking outside of the box to achieve a solution. They share that characteristic with great investors, many of whom don’t take the traditional route to their outcome.
In fact, the best software engineers aren’t even necessarily the best coders or the sharpest programmers. They’re successful because they work different angles or try different approaches to achieving a solution, and they’re persistent in their pursuit of finding the optimal (often, most lucrative) option. Great investors and great engineers also share a knack of learning quickly and often.
How to achieve financial freedom as a software engineer
Software engineers enjoy a great paycheck and frequent promotions with pay raises, but knowing how to save and/ or invest that money is the most important component to achieving financial freedom. Anyone who achieves financial freedom — software engineers included — knows that your paycheck is just a means to making additional money. When you have money, turning around and investing it in any of the following means you’ll be able to compound your earnings:
- Real estate (commercial or residential)
- Stock market
- Crypto, NFTs, or other non-traditional forms of currency
- Retirement savings like 401k and IRAs
- Other luxury investments, like cars, watches, fine jewelry, and art
- Debt payoffs
More important than making money (and additional money on top of it) is how you invest and save. As one software engineer who’s achieved financial freedom states:
“When you get a big pay raise, it is very tempting to spend it on luxuries like a nicer apartment, or a flashy car. To some extent, this is certainly something I did as well. But as much as possible, avoid accelerating your hedonic treadmill, and save that money instead.
Where possible, spend money on experiences, not things – I’ve gone on numerous intercontinental trips and ate out multiple times a week, while still being frugal with my rent and car payments. Compared to all the things I’ve spent money on, financial independence is the greatest luxury of all.”
In short: save your money, invest it wisely (or work with someone who can), and compound on your earnings year over year. Over time, you’ll have enough money to never work again or rely on anyone else for income help.
Start your software engineering journey today
There are many ways to achieve financial freedom. Software engineering is just one of those you can fully control, and it starts with education. Learn more about our immersive coding bootcamp courses that will take you from beginner to full-fledged software engineer in just a few months here.