You only need half your goal plus seven years.
The final number it takes to become financial independent can seem daunting.
You mean I need $300,000 for early retirement? I only gross $30,000 a year, how can I ever amass such a high number?
However this number is misleading, thanks to the rule of 72.
The rule of 72 states that if you take 72 and divide it by the rate of return, then you'll have an approximation of how long it will take to double your money.
The stock market returns roughly 10% per year. Therefore 72/10 = 7.2. It'll take roughly 7 years to double your money.
That makes things seem much more doable, The rat race is only to $150,000. After that you don't have to contribute another dime, all you need to do is sit on your behind for seven years while your retirement builds itself.
It feels good knowing that once I reach $150,000 the maximum amount of time until retirement is 7 years. I'll keep contributing though, so it should be shorter.
Why 300,000? Because 300,000 times .08% yield = 24,000 yearly. That's what it will take to replicate my income. For me $2000 a month is more than enough.
Let's keep running down them tunnels!
You mean I need $300,000 for early retirement? I only gross $30,000 a year, how can I ever amass such a high number?
However this number is misleading, thanks to the rule of 72.
The rule of 72 states that if you take 72 and divide it by the rate of return, then you'll have an approximation of how long it will take to double your money.
The stock market returns roughly 10% per year. Therefore 72/10 = 7.2. It'll take roughly 7 years to double your money.
That makes things seem much more doable, The rat race is only to $150,000. After that you don't have to contribute another dime, all you need to do is sit on your behind for seven years while your retirement builds itself.
It feels good knowing that once I reach $150,000 the maximum amount of time until retirement is 7 years. I'll keep contributing though, so it should be shorter.
Why 300,000? Because 300,000 times .08% yield = 24,000 yearly. That's what it will take to replicate my income. For me $2000 a month is more than enough.
Let's keep running down them tunnels!
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