• 02:03:36 am on October 23, 2008 | 3
    Tags: ,

    In Summary…

    Josh is the first to review his Number … if you will recall, his Lee’s List pretty much encapsulated his Number, as well. However, I’m sure that Josh is glad that he reviewed his requirement, calculations, and assumptions again as the issue of inflation came up, causing Josh to revise his Number upwards by a lazy mill. or so …

    In order to summarize and finalize the necessary fund amount’s needed for my Life’s Purpose I used ebay to find the cost of a used 911 turbo, REMAX.com to find the apartment I want to live in, in the correct place more importantly, and some good old guestimation for the traveling. As per Adrian’s instructions, I tried to minimize what I would really need in order to consider myself successful in realizing my life’s purpose.

    With a humble $100,000 a year the necessary expenses such as food, shelter, clothes, etc. should be taken care of.

    The $130,000 a year would pay for expenses directly relating to my Life’s Purpose of solving real world problems that I have a passion for.

    The $10,000 would cover hobbies and personal interests’, and of course let’s not forget about the Porsche coming in around $65,000.

    This comes down to approximately $4,865,000 to cover a $240,000 per year lifestyle, assuming 9% return on investment in order to compensate for 4% inflation at the same time as living off the remaining 5%. The 4% used for inflation is very important because if the principle remained static I would eventually be a millionaire living in the poor house because over the course of the 70+ years I have left to contribute to society, $240,000 per year would soon seem like $24,000 a year in today’s dollars. Also I forgot to mention this will occur at the age of 31, which is around 7 years from now.

    Check out this site for quick compounding interest calculations.

     

Comments

  • Ryan 3:16 pm on October 23, 2008 | #

    Good Post, you can definitely tell you put a lot of research and thought into your number. One question that came up for me while reading it, was do you ever plan to get married and/or have kids?

    Even if you say no (in which case your girlfriend better not be reading this!), you are young so that could change. If that changes, it’s possible if not likely that your number could go up (different living arrangements, schools, weddings, vacations, etc.). Perhaps, if it’s even a possibility that you could go down that road, you should build in a few “lazy mill or so”!!

  • Josh 10:42 pm on October 23, 2008 | #

    Thats a good question Ryan, and unfortunately I don’t have a good answer.
    All I know is, I want to build my own house, be independent, and figure me out. Once that’s accomplished, I’ll be ready to explore this subject further.

  • AJC 7:40 am on October 24, 2008 | #

    @ Josh – Unfortunately, then, you MAY need to go back to work to pay for it! My advice? Build in the cost of supporting a ‘nuclear family’ (2.4 children and one dog – oh, and a parakeet!)

    … use the $100k, $250k etc. tables to help you; also, stand by for Ryan’s post for a nifty format that you can use to plug your own categories and numbers into.

    It’s also a reasonably safe assumption that if you ‘retire’ at a young age that you will do other things in the course of your life that generate income … but, the safer option is to assume not.


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