Since we've figured out where we are starting from, we can now figure out where we are going.
1. Figure out your financial freedom number.
Multiply your yearly expenses by 25 and that's your financial freedom number!
For those who want a little more info on why multiplying by 25: By multiply your annual expenses (i.e. $40,000) by 25 means we'd get a 4% withdrawal rate (we'd withdraw 4% of our money every year in our financial freedom years) and we'd get a return rate of 4% on our investments every year (here's the formula for you nerds out there: 1/.04 = 25x).
That means we need $1,000,000 invested and we could withdraw $40,000 every year without running out of money.
Remember to not get discouraged, you can always adjust your number along the way and the more you think about becoming financially free, the more your brain works on how to get there even sooner.
You can also figure out ways to decrease your expenses and increase your income (if you need help with this, make sure to click the resource link below).
You can also find great investments, which we will talk about later!
Write down your financial freedom number.
2. Figure out when you want to become financially free.
Use this link to an online calculator to figure out when it would be feasible for you to become financially free: https://networthify.com/calculator/earlyretirement
Remember!! You can always make adjustments along the way to get you there even sooner!!
Write down when you want to achieve financial freedom and how much you'll need to be investing every year to get there.