The Financial Samurai Podcast How Much You Really Need to Invest to Break Free from Work And Change Your Life
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Aug 15, 2024 Discover how to determine your Minimum Investment Threshold and unlock a life free from unsatisfying jobs. Learn the art of negotiating severance packages before leaving a job, maximizing your benefits instead of simply quitting. Explore the burgeoning opportunities in real estate as interest rates decline, promising potential for wealth growth. Gain insights on strategic investments in rentals for steady cash flow and the importance of adaptability in navigating financial goals during uncertain times.
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Minimum Investment Threshold Formula
- Calculate your minimum investment threshold by dividing your gross annual income by the historical return of your asset class.
- This helps determine when your investment returns might match or exceed your salary, offering more work flexibility.
Key Assumptions and Lifestyle
- Live within your means, avoid high-interest debt, and save at least 20% of your after-tax income.
- Maintain your current lifestyle—don't drastically reduce expenses just to retire early.
Government Worker Turned Writer
- A 38-year-old government worker earning $100,000 annually could pursue their writing passion with a $1 million stock portfolio.
- Even with a lower writing salary, their investments provide a safety net, enabling them to pursue their dreams.