Thursday, 23 June 2016

When to stop working and start your early retirement

Looking around, i found some interesting formula, done by one called Doug Massey.

Retirement time coefficient = Age x Net Worth / Yearly expenses

He said that you can retire at the moment when your retirement coefficient is bigger than 1000.

OK, let's reverse engineering this formula for basic expenses. 1000=39 x My net worth/9600, then My net worth will be equal with 1000 x 9600 / 39 = 246.153. Hmm, interesting enough, in my own formula it is 133.455.

The complete financial freedom result will be equal with 1000 x 18000/39= 461.538 while my own formula was 373.455.

I am thinking that the guy really want to feel sure that he is safe, good for him.

Anyway, it is a good try. What is your number? Do you consider it accurate?

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