What's your 'cash' goal?
- Thread starter alexlee
- Start date
Are you guys serious about that amount of cash? Gee, you know how to dream big!
Somedays I think it'd be nice to have about $50K pa, but then I'm single, child free and probably going to stay that way. Other days, when works getting me down and I'm feeling desperate, I redo all my calcs based on my fall back position - around $25K pa
Maybe once I've been at this for a few years and see the benefits then I'll feel more able to deal with the numpties at work because I can see something tangible coming from that paycheque.
DJ
Somedays I think it'd be nice to have about $50K pa, but then I'm single, child free and probably going to stay that way. Other days, when works getting me down and I'm feeling desperate, I redo all my calcs based on my fall back position - around $25K pa
Maybe once I've been at this for a few years and see the benefits then I'll feel more able to deal with the numpties at work because I can see something tangible coming from that paycheque.
DJ
Are you guys serious about that amount of cash? Gee, you know how to dream big!
Somedays I think it'd be nice to have about $50K pa, but then I'm single, child free and probably going to stay that way. Other days, when works getting me down and I'm feeling desperate, I redo all my calcs based on my fall back position - around $25K pa
Maybe once I've been at this for a few years and see the benefits then I'll feel more able to deal with the numpties at work because I can see something tangible coming from that paycheque.
Of course we're serious. If you aim higher, you might not get there but you'll achieve more than if you aimed low.
Alex
Dream Big is needed to break through the boxed-in boundary of our thinking. It involves change in mindset and is relatively easy to achieve.
The next part is to Play Big to realise that dream.
This is where real battles are taken place.
The saying is "Aim for the moon. If you miss it, you'd be amongst the stars".
Are you guys serious about that amount of cash? Gee, you know how to dream big!
Somedays I think it'd be nice to have about $50K pa, but then I'm single, child free and probably going to stay that way. Other days, when works getting me down and I'm feeling desperate, I redo all my calcs based on my fall back position - around $25K pa
Maybe once I've been at this for a few years and see the benefits then I'll feel more able to deal with the numpties at work because I can see something tangible coming from that paycheque.
I think you're using the wrong words here, DJ. It's not 'it'd be nice to have $50k'. You should be thinking 'my first goal is to achieve $50k pa in x years by doing a, b and c.' 'It'd be nice' is far too wishy-washy and isn't a strong enough plan.
In any case, don't make any bets on that you're always going to be single thing.....
Alex
Are you guys serious about that amount of cash? Gee, you know how to dream big!
Somedays I think it'd be nice to have about $50K pa, but then I'm single, child free and probably going to stay that way. Other days, when works getting me down and I'm feeling desperate, I redo all my calcs based on my fall back position - around $25K pa
Maybe once I've been at this for a few years and see the benefits then I'll feel more able to deal with the numpties at work because I can see something tangible coming from that paycheque.
DJ
Personally, I would work on the fallback position first. My reasoning is that you want a figure that is achievable in the near future. Make this your "basic survival" figure (i.e. the absolute minimum you need to "survive").
Put a fixed target date (1-3 years) and go all out.
The "nice to have" is your medium range target - a date somewhat further out (I work on 5-7 years)
I also have a "blue sky" figure set long range (10+ years) into the future. This is the "if everything went smoothly and I extrapolated the performance to date, 10 years into the future, what might I be looking at)
Hope this helps.
Cheers,
The Y-man
OK,
If we're talking cash here then Liz's $2.5M is about right. I base that on requiring a passive income from that cash of $100K pa indexed to inflation. OK, so its a perpetuity where the growth (inflation) is 3% and the realisable rate of return from its investment is 7% (I think I saw some add with a 7.0% cash rate recently)...
So, basic perpetuity formula is:
PV = Perp / (r-g)
For my example this means the amount required is:
PV = $100,000 / (0.07 - 0.03)
PV = $2.5M
Mind you, I think more like the rest of this SS rabble. I have always worked on a net worth of $1M being enough, but unfortunately, now that this is within sight, I think I've already stretched that goal a bit. Lets just say I want $100K pa passive income growing at a rate faster than inflation on a growing asset base too so that my net worth is increasing simultaneously. i.e. I'll push the retirement button when I'm getting $100K pa passive ncome because I know I'll only have to suffer that lowly income for the first year and it will get easier each year that follows.
My current spreadsheet puts that goal about 5 years away (retirement on $100K passive). And by 10 yrs time I think that passive income has more than doubled ($200K+ pa passive). Developing Mona Vale will go a long way to realising my goal as it will give me a good kick in both passive income and net worth.
Michael.
If we're talking cash here then Liz's $2.5M is about right. I base that on requiring a passive income from that cash of $100K pa indexed to inflation. OK, so its a perpetuity where the growth (inflation) is 3% and the realisable rate of return from its investment is 7% (I think I saw some add with a 7.0% cash rate recently)...
So, basic perpetuity formula is:
PV = Perp / (r-g)
For my example this means the amount required is:
PV = $100,000 / (0.07 - 0.03)
PV = $2.5M
Mind you, I think more like the rest of this SS rabble. I have always worked on a net worth of $1M being enough, but unfortunately, now that this is within sight, I think I've already stretched that goal a bit. Lets just say I want $100K pa passive income growing at a rate faster than inflation on a growing asset base too so that my net worth is increasing simultaneously. i.e. I'll push the retirement button when I'm getting $100K pa passive ncome because I know I'll only have to suffer that lowly income for the first year and it will get easier each year that follows.
My current spreadsheet puts that goal about 5 years away (retirement on $100K passive). And by 10 yrs time I think that passive income has more than doubled ($200K+ pa passive). Developing Mona Vale will go a long way to realising my goal as it will give me a good kick in both passive income and net worth.
Michael.
Michael - woo hoo! $1mil net is also within sight for us now....taken 5/6 years to get here. But haven't a clue how to convert it to $50k + p.a passive income. Need to get myself to a NavraInvest seminar! knew I should have bought @ $1.00.
I am thinking once I have a bit of passive income and cash and IP's are paying for itself, I might take a break from developing. Get a job and some sort of life back or live overseas.
I am thinking once I have a bit of passive income and cash and IP's are paying for itself, I might take a break from developing. Get a job and some sort of life back or live overseas.
I just think it's clearer to think in terms of after tax dollars. For me I'm aiming for $1m AFTER tax cashflow in today's dollars.
Alex
God I love you guys!
Just when I think I'm doing well and have some nice big audacious goals set, along comes the SS thought police who put me back in my place.
Time to lift that goal again and stretch for the real action where the likes of Dazzling, JoannaK, AlexLee, HandyAndy +++ hang out.
** me --> crawls back into small corner from whence I emerged and rethinks definition of financial success **
Cheers,
Michael.
I know it mate, that's why I included you in my little list before you'd even posted that goal!I vote for the $1mil net per annum.
Cheers
I wanna join the big league! Cheers,
Michael.
Time to lift that goal again and stretch for the real action where the likes of Dazzling, JoannaK, AlexLee, HandyAndy +++ hang out.
** me --> crawls back into small corner from whence I emerged and rethinks definition of financial success **
Mentally, anyway. I'm nowhere near it yet in reality, but I CAN see it! And as I'm sure most of us have experienced, just seeing the possibility is the hardest part. Hence why so few people actually invest.
Alex
Actually I have to say I'm be perfectly happy with the combined salary we have at the moment (and that's significantly less than $1 mio
Kaf, think about whether you're going to need more money or less money compared to now, if you suddenly had another 12 hours free a day, and no more limitations on holidays, etc.
Alex
Actually, that's kinda the the plan ... 34 now, survival should be reached in 3 years, comfy 5 years, and cruising would be anything after that! After that, it's all about different people wanting different things. If I had $2.5M flowing my way I'd probably stress about what to do with it ... too many options!
DJ
Good point but I think it's true that you never have enough money as you adapt your lifestyle to your resources. So whether it's 100k, 200k or $1 mio / year will just make the difference whether you can't live without flying somewhere / flying first class or going in your own jet.
But everyone is different setting goals. A large goal like $1 mio seem to really motivate you and you are thinking really long term so good on you. I'm thinking 5-10 years and if I aimed for 1 Mio it would be too far for me to take serioulsy. I'm not saying it would be impossible (nothing is) but for my risk profile it would be too big. 100-200k/ year is do-able with some serious work and some reasonable risk within our time frame so that's what I'm shooting for.
And who knows, maybe in 10 year's time I do want my own jet and that will be my next goal
kaf
YepAnd who knows, maybe in 10 year's time I do want my own jet and that will be my next goal
kaf
Agree, you need to be open to changing the goals.
I'm currently looking at $100k after tax, passive income. But once I've got that extra time it might cost us more to do the things we want to do. By then we should have enough knowledge to be able to turn that into what ever we want per annum.
cheers
quoll
