This concept is really important because so many will work and work never think about why am I working. There lot of people who make good money will just work and work. As the old saying goes You can win the rat race but you’re still a rat by Banksy
Look I know for lot people read this they are not good money, however there are people who read this on good money who are always worry about money if they open eyes, they would see how close they are to financial independence. But this is goal everyone should aim for Of course, there are lot of difference ways to get here.
Look there is another concept that is similar to financial independence this concept comes from the film gambler and this speech is given by actor john Goodman “You get up two and a half million dollars, any asshole in the world knows what to do: you get a house with a 25 year roof, an indestructible Jap-economy shitbox, you put the rest into the system at three to five percent to pay your taxes and that’s your base, get me? That’s your fortress of fucking solitude. That puts you, for the rest of your life, at a level of fuck you. Somebody wants you to do something, fuck you. Boss pisses you off, fuck you! Own your house. Have a couple bucks in the bank. Don’t drink. That’s all I have to say to anybody on any social level. Did your grandfather take risks?”
This is the position most people really want when they think of wealth. That is freedom. There are people who say they would not know what to do if they didn’t have to work. For people like this I would say when you think about this is nearly everyone goal, some people just take a bit longer.
People work and build up their pension so they can have fuck you money. Fuck you money can be used to follow your dreams or maybe just spending time with the people that are important you. Do things you want to do it does mean you stop doing anything quite opposite get to do more of things that are important to you. I have talk about concept of the 80/20 rule that we need to eliminate things up most of your time. For lot of people this is their job. Person normally works job for 8 hours a day. A job is a third of your day. So if we could eliminate or even minimise your hours you work. You have a lot more hours to do the things you want. This is concept of fuck you money/Financial independence is way of freeing up time.
Arnold Schwarzenegger has used the concept of fuck you money had the goal of being actor like his hero Reg Park. So, Arnold knew he needed money to help free up his time for his goa. Over time he made money from bodybuilding, He than started few small business selling supplements and books for bodybuilding, he started buying real estate by time he start his acting career he was millionaire had fuck you money. You may be thinking why would person need fuck you money to become actor you may be thinking is the point of becoming actor to become rich. For some people is for others is not. But for Arnold In interview with Brian Linehan in 1979 explaining his rational. Brian pointed out that Arnold “was very careful in what he done as actor” Arnold was able to this because he didn’t need the money this is the reason Arnold had fuck you money so he was more in charge of his career and his destiny. For lot of Actors if they are dependent on the money they force to take parts that could ruin their careers or roles they would hate themselves for doing which could knock all there motivation and for Arnold it could have been very easy for him to be type cast as the evil henchman. During the interview they talk about Arnold turn down starring role with Mae west because he didn’t think film would be made because it was having lot of production issue which would waste lot of his time because he would be able to do other acting jobs as he would be under contract lot of people don’t realise lot of films that only get half made some films do get made don’t get realise for long time which really derails and actor careers. Arnold trusted his gut about this film and he was right. He was able do this because of Fuck you money is about giving yourself financial freedom.
As I have talk before when people are stressed, they lose 10 IQ points by having fuck you money you are able to follow your dream because you will be smarter as you are not stressed. There is theory of Post-scarcity which you will see on tv shows like star trek. Post-scarcity is a theoretical economic situation in which most goods can be produced in great abundance with minimal human labour needed, so that they become available to all very cheaply or even freely. I think this will be better off because a lot of inventors have come from middle class family or wealthy family’s part of reason able to take changes was because their family could support them were someone with poor background even more innovation because they can’t take change as they are support their family. Now some do there are outliers but average most don’t/can’t. If you are poor don’t thing you can’t follow your dreams, I think you’re the outlier. but I have to speak the true.
So, I want you write down what amount of money you think you would need to have fuck you money. Most case people grossly over predict the amount. We will talk about how to work out amount but for now I want to pick number, some of you may pick amount from the film reference that if fine. So, you have something paper. This may seem insignificant. But for lot of people, they always think need more money they ever know when they have enough money.
One of the most famous cases of fuck you money was when Dave Chappelle walked away from $50 million dollars. Dave Chappelle was writing for season 3 of the hugely popular Dave Chappelle after he was worry the show would ruin his artistic integrity he walked away from the show meant walking away from his $50 million contract with Comedy Central. People were saying he was crazy for doing this but the truth was he had enough money some things are more important money. You may be saying well easy to walk away from 50 million if you millionaire. To certain degree I agree with you this point. This is the point of having fuck you money to have enough money when you can do something like this. But when you think about there is not a lot of stories of this happening in the entertainment industry where lot of the people are millionaires because lot of people don’t understand the concept of fuck money if they did I think we might see happening little bit more. For lot people even if you are already low-level millionaire people would still sell their soul for 50 millionaire and also you would have social pressure of people telling you crazy for walking away from the money so you will endure, please other. The point I want make idea of fuck you money is you know when you have enough money to walk away.
Before I talk ed about financial independence you can also have mini fuck you money. I have see done by people in their 20s and 30s this most commonly used to travel abroad for year. They work out how money they need and do cost analysis realise they know when they come back, they can pretty much the same job. I have known people who have done not this not to travel but do hobby they love. I have done this myself very freeing it feels small away how slaves must have felt when they were free. You can walk away from a job in some cases you don’t like or hate after people telling you very important to keep job. You begin to see freedom not just from the job but from peoples preconceived notion. I know lot of people who have done end up getting better jobs when they come back because their mind is much clearer this also happen for Dave Chappelle who got Netflix deal worth over $60 million. For lot of bored interviewers with all the candidates looking the same someone who has taken year off is far for more interesting they will be look forwarding talking to that person. you can have you very own fuck you money.
There has been a movement called financial independence. The definition “typically means having enough income to pay your living expenses for the rest of your life without having to work full time. Some people achieve this through saving and investing over many years, while others build successful businesses that can generate income without daily supervision.”
There was new article about couple in their 30s who retired. Shen says the stressful environment at her job also helped kill their home ownership buzz. “People were working crazy hours. There were people getting blood clots and actually like collapsing at their desk.”
She says it made her think, “Do I really want a house that is so overpriced that I just am going to feel like it’s prison and I am going to have to keep working at my desk until I die?”
So, the couple decided to nix the house hunt. Instead, they enlisted the help of well-known Toronto financial adviser Garth Turner and invested their $500,000.
They put 60 per cent in stocks and 40 per cent in fixed income investments like corporate bonds. That ratio shifted when the market turned volatile. The two also continued to live modestly and invest every penny they saved.
By late 2014, Shen and Leung say they doubled their money to $1 million.
Their investments continued to grow so the two decided to ditch their jobs last year. They don’t even pay rent now because they’re always travelling.
This couple offered free course no email or sign up. Which running a year-long workshop, using REAL money, in the REAL stock market, to show you exactly how to build your own portfolio of low-cost index ETFs, just like ours. And they will be there, every step of the way, to help you out and answer your questions. highly recommended while they’re of plenty of book that explain this principle. This course was done in real time in 2016. In worth noting as this course was done over year the results do matter as this type of investing done over the long term.
To calculate your own Financial Independence Formula, the first thing you need to know is exactly how much you’re currently spending each year.
Your FI Number depends on two things: your current spending, and your safe withdrawal rate (SWR). Your SWR is the percentage of your savings you can safely withdraw without running out during your lifetime.
The Financial Independence Formula
Reaching Financial Independence is an ambitious goal, but it isn’t a complicated one. In fact, just a few simple calculations can give you a rough estimate of how many years it should take you to get there, based on your current rate of spending and saving.
Basically, the Financial Independence Formula has two parts. The first part calculates your FI Number – the total amount of money required to give you a sufficient income for life:
FI Number = Yearly Spending / Safe Withdrawal Rate
The second part of the formula uses your FI Number to figure out how many years it will take you to reach FI:
Years to FI = (FI Number – Amount Already Saved) / Yearly Saving
This is only a rough approximation, but it’s good enough to give you an idea of how far away you are from FI right now. Once you know that, you can start taking the following steps to reach personal Financial Independence sooner.
For example, if your current spending is $30,000 per year and your SWR is 4%, you would divide $30,000 by 0.04, resulting in an FI Number of $750,000.
Many financial experts say that 4% is, in fact, a reasonable SWR for most people. This guideline, known as the 4% rule, is based on a 1998 study published in the Journal of the American Association of Individual Investors, which is usually referred to as the Trinity Study. The study found that retirees who have at least half their nest egg invested in stocks can safely withdraw 4% of their starting money each year – adjusting annually for inflation – and have more left at the end of 30 years than they started with.
Over the long term, the Trinity Study calculated, the 4% rule works through all kinds of market ups and downs. As long as you withdraw no more than 4% of your initial funds each year, your investments should last you for the rest of your life.
Some financial experts claim the 4% rule is no longer valid in today’s economy, with its rock-bottom interest rates. However, a 2015 study by PricewaterhouseCoopers (PwC) concludes that the rule is still reasonable for households with “considerable wealth” – in other words, those that are Financially Independent. So even if the 4% rule isn’t perfect, it’s still a good guideline for planning your way to FI.
For instance, if your FI Number is $750,000, and you’re managing to save $25,000 a year, it will take 30 years to reach FI.
However, this assumes that you’re starting from zero. If you already have some money in savings, the picture looks brighter. For instance, if your FI Number is $750,000, but you already have $250,000 in your retirement accounts, then you only need to save another $500,000 to reach FI. So at a rate of $25,000 per year, it will take you 20 years to get there.
On the other hand, if your savings rate is lower, then your time to FI becomes longer. For instance, if you are only saving $10,000 per year, it will take 50 years to save up the $500,000 you need to reach FI. And if you save nothing at all, reaching FI becomes impossible – your savings never grow, and FI never gets any closer.
The way to do this Maximize Income + Cut Expenses = speed up process.
Different kind of financial independence
- Having business that allows you a lot of independence. Please note having business were you but in lot of hours is not this.
- Having money were take few months of or few years off but still need to get more income
- Having enough money were you really don’t have to think about it
