How much money do you “Really” need to be completely “Financially Free”? Have you “Really” thought about it?

If we are asked how much money we need to be completely “Financially Free”, I am sure many will say “a huge amount”, like millions or billions or even an infinite amount. At least that was my answer until not long ago.

And that was a problem. That showed that I had not really thought about it and only had a very vague idea: I need a looooot of money.

What really got me into thinking about it was an article I read. That was an interesting article, in which the author split the population into 10 classes in China context. When describing the class with annual income 5–50 million RMB, the author stated (not exact words):

- Luxury was not an issue at all. Let’s say you spend 10K RMB a day and that is only 3M a year. Do not think spending 10K every day is easy. Think about it, 10K, every day, pure consumption.

That clicked with me. It is not easy to spend 10K RMB or 2K SGD every day on pure consumption.

I recall my days as a consultant in the prestige firm. When I was serving a client in Toronto, my daily average spend was about 600–700CAD, aka 600–700SGD.

- Hotel: ~400CAD a day

- Meal: ~150CAD a day

- Transport: ~100CAD a day

This represents the highest daily average for me and that is only 30% of 2K SGD.

So there is actually an earning amount, exceeding which we will be free to enjoy “Luxury”.

But what would be that “Amount”?

For me, I think 1K per day is enough for me. Of course, I need to consider my wife and kids. I think 2K should be enough. That would be equivalent to ~600K SGD a year. Double that, 1.2M sounds good to me.

For you, I can think of two ways to derive the “Amount”.

1) Estimate a daily “hard to spend all” amount and basically do it in a similar way above

2) Look at your dreams. List them out, estimate the cost of each one, and sum it up. This will give you a lump sum amount you will need to fulfill your dreams. Divide that into each year, and add the “normal” annual spend, and then you will have the annual amount you need. Double that and there is your “Amount”

I am sure there are more ways to do this. But the logic behind is interesting: Once you are rich beyond a certain point or earn more than a certain figure, it would be hard to spend all your money.

Maybe that point seems far away. Stay at it and try our best. We will be there.



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Top-tier consultants seeking life purpose and self-realization