What's Your Number

One of the things we teach when developing a business plan is to build a business that allows you to do the things that you love. To do the things that you love you need money.

The question people ask is, how much money do I need? I often wonder what is my number. How much money do I need to make to maintain my lifestyle one day I decide to stop working. Over the last few weeks i have been reading an interesting book called “The Number by Lee Eisenber” in it he says to calculate your number you should take your required annual earnings and divide it by 4% . I have done a couple of examples for you:

If you would like to earn $50,000 a year when you retire to need to have $1,250,000
If you would like to earn $75,000 a year when you retire to need to have $1,875,000
If you would like to earn $100,000 a year when you retire to need to have $2,500,000
If you would like to earn $125,000 a year when you retire to need to have $3,125,000
If you would like to earn $150,000 a year when you retire to need to have $3,750,000
If you would like to earn $175,000 a year when you retire to need to have $4,375,000
If you would like to earn $200,000 a year when you retire to need to have $5,000,000
If you would like to earn $500,000 a year when you retire to need to have $12,500,000

Calculate your number and if you’re business can’t give you this you’re in the wrong business

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