The DML Financial Freedom Model: The 3-Layer System That Changed How I Think About Money
For 15 years, I lived without a budget, without savings, and without a single thought about financial freedom.
Between 2004 and 2015, when salaries were strong, inflation was low, and life was cheap, I took two holidays a year, spent freely, and told myself: "Renting is smarter than buying anyway."
I believed it. Until I didn't.
Salaries started falling short. Life got expensive. And slowly, quietly, the anxiety crept in. That low-level hum of "what happens if something goes wrong?" that never fully goes away.
I was getting older. And I had nothing to show for it.
The Turning Point
In the summer of 2018, I stumbled across the concept of financial freedom.
I already knew the term "economic independence" but financial freedom was different. It had a system behind it. A roadmap. And it overlapped perfectly with everything I was quietly worried about.
I went deep. Books, YouTube channels. Frameworks. I spent roughly three years in research mode, running small experiments in stocks and crypto, building a dividend portfolio, then exploring mutual funds. Each step taught me something. Each step also showed me what was still missing.
Here's what I eventually understood:
Financial freedom isn't a single move. It's a system.
Not a hot stock tip. Not a savings hack. A layered, interconnected system that you build deliberately and then let work for you.
That's what I built. I call it the DML Financial Freedom Model.
What Is the DML Financial Freedom Model?
The name comes from my daughter's initials. That's intentional. This model isn't abstract finance theory it's the actual framework behind real decisions I've made: when to retire, where to live, how to structure my career going forward.
The model has 3 layers:
- Layer 1: Income Generation How money enters your life
- Layer 2: Savings & Budget How you capture and protect what you earn
- Layer 3: Investment How your money grows and sustains you
Each layer feeds the next. Remove one, and the whole system weakens. Let me walk you through each one.
Layer 1: Income Generation
This is the engine.
Without income, nothing else in this model works. No savings, no investments, no financial freedom. This might sound obvious, but most people stop here they have one income stream and assume that's enough.
It's not.
I believe sustainable financial freedom requires 4 income channels working in parallel:
Channel 1: Fixed Income
This is money that arrives regardless of whether you work. Pension payments, social security benefits, retirement disbursements from a foreign employer anything institutionally guaranteed. The amount doesn't have to be large. What matters is the stability. Fixed income is the baseline that keeps your life from depending entirely on your own effort.
Channel 2: Active Income
This is what most of us rely on: the 9-to-5 salary, freelance contracts, consulting fees, part-time work. Time and effort exchanged for money. For most people, this is the only channel. That's the problem. One channel means one point of failure.
Channel 3: Passive Income
This is my favourite channel and the one most people underestimate.
Passive income is money that flows in without you actively trading time for it. Book royalties. Software licensing fees. Content that earns while you sleep. It requires upfront work to build, but once the system is running, it runs without you.
Sounds appealing, right? It is. But it takes longer to build than most people expect. Which is why you don't rely on it alone you build it alongside the others.
Channel 4: Financial Income
This is capital at work. Rental income, dividend payments, capital gains from long-term investments. It requires financial literacy to do well, and it requires capital to start. But done right, this channel has the highest long-term return potential of all four.
Here's the key insight:
You don't need all four channels running from day one. You need at least one producing consistently, while you build toward the others. The more channels you have, the more resilient your financial life becomes. If one stops a job loss, a market dip the others keep flowing.
Each of these four channels deserves its own deep dive. If you want to go beyond the overview and understand exactly how to build each stream with real examples, a 30-day action plan, and the full DML income architecture explained step by step I've covered it in detail here:
Beyond the 9-to-5: Building a Resilient 4-Layer Income Engine
That article is where the framework becomes a system you can actually implement.
Layer 2: Savings & Budgeting
This layer is the bridge between earning and investing.
And it's where most people including me, for years completely fail.
I earned well in my early career. I saved nothing. The money came in and went straight back out. That period is gone now, and I can't get it back.
Don't make the same mistake.
The minimum target: save at least 10% of your monthly income and redirect it toward investment. That number isn't magic it's the floor. Some months you'll do more. What matters is the habit, not the amount.
Budgeting deserves its own deep dive and I'll write a dedicated article on the system I use. But the core principle is this: Pay yourself first. Before bills, before lifestyle, before anything else. Your future self is a creditor. Treat them like one.
Layer 3: Investment The 3-Bucket System
Now we get to the part that most financial content skips entirely: not what to invest in, but how to structure your portfolio so it does different jobs at different times.
I organize my investments into three buckets. Each one has a distinct purpose, a distinct time horizon, and a distinct risk profile.
Bucket 1: Short-Term Portfolio (Emergency Fund)
Think of this as your financial life raft.
This bucket holds liquid assets money you can access within 24 hours if everything goes wrong. Job loss, medical emergency, unexpected repair bills. The goal here is not growth. The goal is instant availability and zero risk of loss.
How much should be in it? At minimum, the equivalent of 3 months of income. Personally, I'm more comfortable at 6 months that's a psychological preference as much as a financial one. Find what lets you sleep at night.
What it holds: daily interest accounts, repo agreements, money market funds. Nothing with lock-in periods. Nothing with downside risk. Low returns are fine here this money isn't supposed to make you rich. It's supposed to keep you stable.
Bucket 2: Mid-Term Portfolio (Growth Engine)
This is the workhorse bucket. Assets held between 3 and 9 months, primarily focused on beating inflation and generating returns that exceed what Bucket 1 can offer.
My Bucket 2 is built primarily from mutual funds commodities, thematic funds, equity funds, gold, silver. The composition shifts as market conditions change. I review it at month-end or when significant news breaks.
But Bucket 2 isn't just a growth vehicle. It has a critical systemic role:
- When it grows too large, it transfers assets up to Bucket 3
- When Bucket 1 depletes, it refills it
- In extended emergencies, it acts as a secondary safety net
This bucket is the connector. Without it, the whole system becomes fragile.
Bucket 3: Long-Term Portfolio (Wealth Engine)
This is the endgame bucket.
My core principle here: money that enters Bucket 3 does not leave.
What goes in? Long-term dividend portfolios. Crypto positions with multi-year horizons. Retirement savings instruments with compound growth potential. Assets I intend to hold for decades and eventually pass on.
This bucket isn't managed actively. It's managed patiently. The goal isn't to optimize every quarter it's to compound over a lifetime.
One practical note: I also use a structure I call the Palet BES System a way to generate regular income from private pension savings before the standard retirement age conditions kick in. If you're in a market with similar pension structures, it's worth understanding the rules and optimizations available to you.
Why This Model Works
Most financial advice gives you tactics.
Buy this asset. Cut this expense. Follow this rule. And then it leaves you wondering: but how does this all fit together?
The DML model is not a tactic. It's an architecture.
It works because every layer supports the others:
Income funds savings. Savings fuel investment. Investment structured correctly across three time horizons generates the returns that eventually make work optional.
Here's what makes it different from generic advice:
- It's designed for real life, not ideal conditions. The 3-bucket system handles emergencies without touching your long-term wealth.
- It's built for psychology, not just math. Knowing you have 6 months of liquid reserve changes how you make decisions. Calmly, not fearfully.
- It scales with you. Whether you're just starting with one income channel, or you're managing all four the structure is the same. You just fill it in over time.
I made my decision to retire early using this model. I decided when using it. I decided where to live using it. My current work and creative direction are shaped by it.
It's not a spreadsheet. It's a lens for every financial decision I make.
Final Thoughts
Financial freedom isn't reserved for people who got lucky, started early, or earned more than you.
It's available to anyone who builds the right system and then actually uses it.
The DML model won't tell you which stocks to buy. It will tell you how to think about your money, so that every decision you make big or small moves you in the right direction.
I'm documenting every part of this journey. Each layer of this model will get its own dedicated article, with real numbers, real decisions, and real results from my own experience.
If you've been looking for a framework that makes sense of it all this is the one I use.
The next step is yours.
Every week, I break down one piece of the financial freedom puzzle practical, personal, and built from real experience.
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No fluff.
No generic advice.
Just the system, documented as I live it.