October 24, 2020

How much should I invest to stop working in the next 10 years

invest to stop working

The movement of young retirees that originated in the United States is spreading around the world. More and more people are trying to accumulate enough money to quit their jobs as soon as possible. The desire to retire at the age of 30-40 is argued by the fact that people do not want to give the best years, working for an employer. So many people have a question: How much should I invest to stop working in the next 10 years?

In order to implement such a plan, it is necessary to save as much as possible and invest money so that it would bring income. Most often they invest in the stock market and the purchase of real estate. On the Internet resources devoted to the topic of Early Retirement, it is advised, regardless of the level of earnings, to save about half of their income. The size of the “wallet”, enough to go on a well-deserved vacation, should be at least the size of your annual income, multiplied by 25. Saving money is advised in conservative instruments: real estate (where it can be controlled), gold, deposits in reliable banks, bonds.

A successful retiree at the age of 30 told how he managed to achieve this. He made his first savings while earning a living during his student years. Then he started his own small business. Using the benefits as a small entrepreneur, he purchased municipal real estate at reduced prices. Now he has 30% of his existing income enough for a comfortable life. A young woman, who is now 30 years old, was able to buy two apartments in the mortgage, having repaid it prematurely. She believes that within a few years she will put aside another good amount for a deposit and will be able to leave his work. The main advice for those who want to retire as early as possible is to limit consumption, giving preference to investment and capital creation.

The magic of complex interest

The founder of the Rothschild Dynasty, the richest man in the world at one time, called a complex percentage of the eighth wonder of the world. Those who understand how it works always win. Those who ignore it, pay the price for their ignorance. To understand what a complex percentage and how it works, just, even if you do not like mathematics. When you invest in financial instruments for a long time, if you don’t take money with a small profit, but instead add money to your account, your income increases exponentially.

Simply put, at the end of each period, your interest income is summed up with the deposit, and interest for the next interval is accrued on that amount. Almost the entire financial system works on the basis of a complex interest. But most people find it difficult to understand its magical nature, because since school we are all used to thinking in linear categories: add and subtract prime numbers.

Leave a Reply

Your email address will not be published. Required fields are marked *