This is how I’m going to get to $250 Million
Everyone has a number, right? Or is it just me?
I’m talking about that financial goal that you’re trying hit. Come on, you must have one!?!?
Well that number for me is a quarter of a billion bucks: $250 million; and this is on the conservative side.
Yes, you read that right. Now before you call me nuts, here’s how I’m going to do it:
First, note that the spreadsheet above shows the Rule of 72. Here’s what the Rule of 72 is according to Investopedia: “…a simplified way to determine how long an investment will take to double, given a fixed annual rate of interest. By dividing 72 by the annual rate of return investors can get a rough estimate of how many years it will take for the initial investment to duplicate itself. For example, the rule of 72 states that $1 invested at 10% would take 7.2 years ((72/10) = 7.2) to turn into $2. In reality, a 10% investment will take 7.3 years to double ((1.10^7.3 = 2).”
How do you plan on doing this?
First, my goal is to hit $2 million by age 40. Now that number doesn’t sound as crazy right? And obtaining an annual return of 7%? That is not a stretch at all. All of this is very realistic for me given where I’m at currently. This $2MM number is almost too conservative, but I want to have a high, but reachable and actionable, goal. So if you know anything about me, I like to have realistic goals that are actionable. Because all goals can, and should be, reverse-engineered. So I can tell you with certainty that $2MM by age 40, for my wife and me, is a conservative and reachable figure. Our family’s annual gross income is projected to be between $300 – 400K within this time period unless something drastic happens that changes one of our employment statuses. Again, these aren’t dreams. These are real numbers that I’m projecting using today’s numbers + short term forecasts + what can be reasonably expected in combined income, starting from today, for the next 10 years.
Related: Side Hustle your way to Freedom
So you’re planning on living to 110?
Yes, why not? Unless Jesus returns, or I die due to some unfortunate circumstances, and barring some sort of dystopian future, I don’t see why I couldn’t live to 110. People are living longer and longer, and we’re at the cusp of unimaginable technological and medical breakthroughs within the next 20-40 years. Unimaginable breakthroughs (i.e. Nano Technology, Brain Computer Interfaces, AI and Automation, etc). And we’re starting to see some of it even today (i.e. genome sequencing, AI and algorithms diagnosing cancer, Alzheimer’s, and other genetic disorders, etc).
Related: We’re Living in the Golden Age
Why not $1 billion or $1 trillion?
I think $1 billion isn’t out of the question. I think if, within my lifetime, I hit it big with any of my businesses, I think $1 billion would be reachable. $1 trillion on the other hand isn’t; only because it’s not actionable for me. Having a $1 trillion goal post would mean I would need to quit everything I’m doing in order to get into the AI industry right now. Because that’s where I think the first trillionaire will be minted. But given that I’m not in that field, nor do I have any plans on going that route, reaching $1 trillion will not be feasible for me.
What if you don’t reach your number?
Everything has a potential for happening, or not happening. So I’m not ruling anything out. But I like to measure progress and I like to have actionable goals. Actionable goals are what helps us strive to do more, and be more. And at the end of the day, I can guarantee you that the end result will be unfathomably better when compared to not having set any goals from the onset. The important thing here is that the goals need to be actionable. Something you can reverse engineer from the end result you’re looking to achieve. And lastly, as a believer in God, it would be remiss if I didn’t mention that money is not everything (congrats! You found the hint for the 8/20/18 $100 cash giveaway! He’s unfortunately passed but he was the king of pop and was young at heart till the end. The song was a huge hit and was released in the early 90’s in his 8th studio album, wow!). It happens to be something I have a passion in, and something I feel that I’m gifted in. I’m not talking about money in and of itself. I’m talking about money, investing, and general finance. The creation of value, which begets money. And the overall proper stewarding of one’s resources. If at the end of the day, I don’t reach my goal, I’m fine with it. I won’t get to take anything when I die anyways! But just because we’re all going to eventually die, doesn’t mean we shouldn’t have goals for ourselves!
Do you have a number? Care to share yours?