Accelerate your journey to FI by 1) earning more, 2) spending less, and 3) investing smartly.

​

As a rule of thumb, you achieve financial independence if your living expenses are 4% of your investments. For example, if you can comfortably live on $60,000 per year, you need investments of $1.5 million (which can easily be achieved over time if following the principles explained in this blog, even for people with low to moderate income). The U.S. stock market, as measured by the S&P 500 index, has historically returned around 10% per year since 1926. Studies based on historical data show that you can safely withdraw 4% of your investments per year while still growing your investments.

​

Figure out how much money you need per year (e.g., $50,000), divide that by 0.04 (4%), and you will get your FI number (e.g., $50,000/0.04 = $1,250,000). Then go ahead and 1) earn more, 2) spend less, and 3) invest smartly until you hit your FI number. Then enjoy your financial freedom. You don't need to worry about the next paycheck anymore. You can retire early, travel the world, build your own business, or continue to work if (and only if) you still like your job.

EARN MORE

Pillar I

Get a raise or promotion in your current job.
Get a higher paying job.
Turn your hobby or passion into a side hustle for extra income.
Develop multiple streams of income: salary, interest income, dividend income, rental income, side hustle, affiliate marketing, blogging. The list is endless.