This exercise will help you to estimate the productive asset base that would completely replace your current job.
Directions:
Fill in your current income from your job.
Divide your current income by 5% (0.05) and 10% (0.10) respectively. These are possible rates of return that you might seek.
Write in the resulting “Productive Asset Base” in the boxes [...]
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The only way to become independent of your job is to build your productive assets until they generate enough cash flow to cover your lifestyle expenses.
Productive assets are interests in business, real estate and intellectual property. They produce cash flow now, appreciation later, or both.
Productive assets deepen your reserves in a financial emergency. [...]
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While your definition financial independence depends on your lifestyle and personal preferences, there are many reasons to consider making it a priority.
The social security system is under duress. Whether it exists or not when you gain retirement age, it almost certainly won’t be enough to support your lifestyle.
Corporate pension plans are disappearing and [...]
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I know that it is hokey to have “5 Steps” to just about anything, but we humans need some kind of organizational structure to be able to grasp new concepts. We like systems, and the simpler the better.
So, while these five steps not are the be-all and end-all of the financial universe, they do [...]
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Three Levels of Financial Independence
Anyone can be financially independent. All you need to do is be willing to keep your break-even point low so that you can build seed capital and collect productive assets as rapidly as possible. Whether you spend your entire life in the start-up phase with minimal stress, or become [...]
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Anyone can be financially independent.
All you need to do is be willing to keep your break-even point low so that you can pursue one of two lifestyles:
Balancing work and lifestyle to break-even for the rest of your life, or
Building seed capital and collecting productive assets that eventually replace your job.
1. Breaking Even Is Financial [...]
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Financial independence is organizing your life around the people and things that make you happy.
Instead of letting the demands of your work and expenses drive your schedule, financial independence is when you intentionally include (and exclude) the events, people and things that make you smile. There are a number of definitions of financial [...]
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Dana Kunz