Sunday, February 22, 2009

Magic Numbers

Do you have a Magic retirement number?

Does having to save 1 million dollars in order to retire apply to you?

What do you think of the safe 4% draw a year so that you never deplete you savings?

There is a new spreadsheet in our household designed to answer the above questions. What we would like to know is:

  • Can I cut back my Fridays before the mortgage is done?
  • When can we afford to not work at all?
  • What difference does another 2-3 years of work really make?
  • What if we liquidate 1 or 2 properties, does that make really early retirement (40's) possible?
  • Which of us would like to work til mid 50's?
Right now, both of us want the option of cutting paid work out completely by early to mid 50's. I am always trying to push the envelope so I'm asking what about 40's? My mind thinks it would be cool to wrap my career up in another 10 years when I'm 47 yrs old.

By then, I ought to be skilled enough in other things that I can start a different business or move out west or out east and find something to do there. I think I will be ready for a change.

I've been on the hunt for things to learn/skills that would be marketable almost anywhere we would want to go.


  1. I think there is a different number for everybody. No situation is ever the same, it's all about your living costs.

    I'll be 47 when we move to Portugal, so I'll be quitting my full time (rat race) job, but I can't imagine doing nothing, I hope to still bring in a little money.
    My husband will still be in his thirties so not ready to quit working, but our living costs will be less so there will be no need for him to work like he does now...too much!

    The possibilities are endless if you can live frugally :)

  2. Hey Middle Way,

    My magic number is $5000 passive income per month. At that point I will comfortably retire with more than enough to spend, and even enough to continue saving and investing off that passive income flow.

    Challenging number? You bet! But it's great fun working towards it.

  3. Hi laura! In the long run I cannot imagine not doing anything either. But I do see myself floating along for a while after quitting my career to figure out what to do... :)

    As a percentage, how much lower do you anticipate your costs will be in Portugal?

    Hi Daphne! Yes, $5000 a month ought to let you achieve savings and spending goals too. Once achieved, you won't have to worry about finances! Good luck!

  4. Hi Middle Way - I'm going to post a comparison in living costs soon. I just need a little help from my Portuguese friends.

    -I figure it'll be a lot less as a certain daughter will no longer have daily access to my