What Price Your Freedom?
Question: “Would you like enough money so you never have to work again?”
Okay, I feel fairly certain the answer will be “YES!” but I wonder if you’ve ever stopped to consider how much that is – apart from “lots”!
It’s something I’ve got used to over the years – the fact that almost everyone longs to be in this wonderful state, but hardly anyone can name the figure they need to get there. And since ALL money takes time and effort to acquire, it’s vital you know the amount you’re chasing! In this blog I won’t go into the philosophy of why you want money in the first place, what deep needs it may be meeting, and so on. For now I want to concentrate on what I call your ‘Freedom Figure’ – that’s the amount you need to get your ‘Certificate of Freedom from the Master’. If you had this money, you wouldn’t be rich, but you would never need to work again.
Here’s a very quick way to calculate it – it’s not super accurate, but it’s good enough. First, work out the GROSS salary you need to live on (that may be your current salary if you’re living okay on that, if not, choose a salary you could live on). If there are two of you, add the salaries together. What we’re aiming for is a yearly gross salary that you could live on comfortably (but not excessively). Enough to pay all the bills, run a car, have the odd meal out, buy birthday presents, new clothes now and then, etc. Let’s say it’s £50k. Now multiply this by 20 – and that’s your Freedom Figure. So in this case, you would need a million. Why 20? Because if you put one million ‘in the bank’ at 5% interest (100/5 = 20), you’d get an unearned salary of £50,000 a year. Simple.
Yes, yes, I know about inflation, varying interest rates and so on – we’re after a quick and dirty figure here so let’s not nit-pick. Please do this exercise now, for yourself – that’s how much you’re aiming for before you can consider yourself a free man or woman. Don’t be daunted, tens of thousands have achieved this amount – and more.