How much $ is needed to never have to work again?

[Perplexity]

LOL @ $2k/month.

But setting that aside, back of the envelope calculation:

Inflation-indexed government bonds yield something like 2%. To have $24k/year after taxes, you probably need like $35k/yr income or something. If you want money to gradually increase (in real terms, after expenses/taxes), you need like $40k/yr. At 2%, that means you need $2 million.

[Ludanto]

I knew 2k would make people smile, lol.

2 million is a lot more than I would have guessed. But (as mentioned at the beginning of my OP) I have no clue. One also has to see that inflation-indexed government bonds sounds like a bullet proof thing.

I wonder what people with a good knowledge about the stockmarket, poker, sportsbetting (from the sportsbetting forum it looks like one can live of that) or other trades would say they would need.

In some post (was in NVG though I think) someone wrote in the past that 100k would be enough to make him never "really work" again. Even with my extremely limited knowledge about finances I think this is low though. [img]/images/graemlins/wink.gif[/img]

[scott1]

someone wrote in the past that 100k would be enough to make him never "really work" again.

This probably assumes online poker is not work. Even then, it's a terrible assumption.

+++++

I had a friend a few years back whose company stock options ballooned to the point that he asked his father (a VP of finance at a major company) how much he would need to retire at 25 and live the same lifestyle his parents did. I'd describe the lifestyle as the upper end of middle class. Nice 4 BR house in the 'burbs (no McMansion), new Lexus every 4-5 years, travel and dining out at a reasonable rate. Assume married and children at some point. His father's answer was "5 million".

This was without all of your assumptions, though.

[Ludanto]

[ QUOTE ]
I had a friend a few years back whose company stock options ballooned to the point that he asked his father (a VP of finance at a major company) how much he would need to retire at 25 and live the same lifestyle his parents did. I'd describe the lifestyle as the upper end of middle class. Nice 4 BR house in the 'burbs (no McMansion), new Lexus every 4-5 years, travel and dining out at a reasonable rate. Assume married and children at some point. His father's answer was "5 million".

[/ QUOTE ]
This is very interesting. I wonder what HE meant when he said he wants to retire. I would be very interested in what his assumptions where that need to be fullfilled before he can say he 'is retired'.

[scott1]

I wonder what HE meant when he said he wants to retire.

I'm pretty sure he meant nothing that resembles work. No managing real estate, no sales calls or whatever. Let someone else manage your money, live to a ripe old age and not worry about financing the lifestyle of you or your wife. Money does not necessarily increase every year, like your assumption, but stays at such a rate that you won't run out before you die.

[Ludanto]

He still would probably need 3x more than what I used in my example. So I would be fine (according to his dad) with about 1.5M - 2M. That's sounds like Perplexity's guess. [img]/images/graemlins/smile.gif[/img]

[majesty2009]

Your number will always go up if you ever actualy hit it.

$2000X12
----------
.08X.05

You will need $6,000,000 if you want to start drawing out immediatly.

[celiboy]

[ QUOTE ]
LOL @ $2k/month.

But setting that aside, back of the envelope calculation:

Inflation-indexed government bonds yield something like 2%. To have $24k/year after taxes, you probably need like $35k/yr income or something. If you want money to gradually increase (in real terms, after expenses/taxes), you need like $40k/yr. At 2%, that means you need $2 million.

[/ QUOTE ]

$2K is reasonable. I track my expenses every few months and I come in around $1650 per month, but my mortgage is only $300. My mtge will be paid off in the next few months, so I'd be looking at $1350 per month in expenses. I live in Canada so I don't have to worry about health care at all and I'm not married or have any kids so obviously that would be higher with either. The key to retiring early is getting your monthly expenses as low as possible...no mortgage, no car or other debt payments ever. Just sock that money away every month in EFT's and low cost mutuals that have outperformed their group average for 15 years or more. Working for the man is [censored] hell and the sooner you retire the better.