5 million. Invested at a modest, low-risk 2% (which you used to be able to get from a standard savings account), that gives you $100,000/year: quite a decent baseline.
Poll: What number would make you say "I am financially independent"?
21–30 of 89 posts
Re: Poll: What number would make you say "I am financially independent"?
#22Earlier quoted context omitted.
500k is the smallest number I've seen for this calculation. What kind of investment are you thinking?
500k at 7% per year (common number used for the growth of the market as a whole, and thus the average growth of index funds) means $35k/year, not an unreasonable salary to live on.
You need to subtract ~3% inflation from that number every year to reach "spending power."
Therefore, you're only receiving 20k in spending power and allowing nothing for value appreciation. If you can live on that, more power to you though.
Re: Poll: What number would make you say "I am financially independent"?
#23Earlier quoted context omitted.
500k is the smallest number I've seen for this calculation. What kind of investment are you thinking?
500k at 7% per year (common number used for the growth of the market as a whole, and thus the average growth of index funds) means $35k/year, not an unreasonable salary to live on.
[deleted]
Re: Poll: What number would make you say "I am financially independent"?
#24Based on the tables in http://en.wikipedia.org/wiki/Cost_of_raising_a_child for the US. I estimated that the cost of raising 2.5 children for 22 years (up to 18 plus college) as nearly $1.4 million. This may be low balling it if you invest heavily in extra educational and extra-circular activities for your children. So I said between 5-10 million as I would also need some margin for me, my wife and retirement. However, I didn't do any calculations on what cost of living expenses could be like in the future.
Re: Poll: What number would make you say "I am financially independent"?
#25I'd feel more financially independent with a cast iron $5,000 of passive income per month than I would with $1,000,000 in the bank.
Obviously the lump sum would probably be able to yield that sort of money in interest, but the interesting thing is that it should be much easier to secure the monthly passive income than it would the lump sum.
Re: Poll: What number would make you say "I am financially independent"?
#261 - 500k
Pretty much all I'd have to spend money on would be food, taxes and internet, maybe a computer every half decade to a decade and a few books here and there. Buy a couple of flats or something to set me up with some trickle income to cover the necessities and... yeah. I can see being able to go off and work on the projects I'm interested in with a few hundred k in hand.
Re: Poll: What number would make you say "I am financially independent"?
#27500,000 invested intelligently would give you a yield where you could expect a decent income to live upon, so if you are clever enough that should be enough. Plus it would give you the freedom you wish for, plus a little incentive to do "something" as its not a crazy amount of money....
500k is the smallest number I've seen for this calculation. What kind of investment are you thinking?
There are some FTSE 100 companies with a 7% dividend, if that's too risky for you, buy a fund....
Have a look at http://www.topyields.nl/ also....
Re: Poll: What number would make you say "I am financially independent"?
#28Earlier quoted context omitted.
Wow, may I ask what expensive interest / neighbourhood you have? Just curious ...
I live in the US (expensive east coast). Here, you get average of 1% yield on your bank which is considered high yield btw. So 1% per year before taxes is 100,000. Thats a min. pre-tax that I need. Note that I did not mention anything about investing/markets etc. because those are not guaranteed.
30-year Treasury yield is about 3.1%
Re: Poll: What number would make you say "I am financially independent"?
#29To put it into perspective here's Felix Dennis's wealth classification table: £1m-£2m: The comfortable poor £2m-£5m: The comfortably off £5m-£15m: The comfortably wealthy £15m-£40m: The lesser rich £40m-£75m: The comfortably rich £75m-£100m: The rich £100m-£200m: The seriously rich £200m-£400m: The truly rich £400m-£999m: The filthy rich More than £999m: The super rich http://www.businesswings.co.uk/articles/Felix-De…
To be clear, this table is considering those with £1m-£2m in assets to be the poor?
Re: Poll: What number would make you say "I am financially independent"?
#30Earlier quoted context omitted.
Wow, may I ask what expensive interest / neighbourhood you have? Just curious ...
I live in the US (expensive east coast). Here, you get average of 1% yield on your bank which is considered high yield btw. So 1% per year before taxes is 100,000. Thats a min. pre-tax that I need. Note that I did not mention anything about investing/markets etc. because those are not guaranteed.
If you ever have a decent amount of money to put away please talk to a reputable financial planner.
Also commenting on your "note" that you added on. Investments aren't guaranteed... but putting all that money in a bank isn't guaranteed either. FDIC only insures so much.