In the September issue of More magazine, women were asked how much money it would take for them to leave their current jobs and pursue their passion. 60% said $1 million.
Is that enough?
Well, let’s start with a desired retirement age for many-55 and assume a 12% avg return on your money. If the money is in a 401k, you can’t touch it until 59 &1/2. Poo!
What do you do?
How do you fill that 41/2 year gap?
Let’s say you were an excellent saver (15%) and had the 15% of this money in good growth mutual fund investments ($150,000). Could you live off this and it’s return for 41/2 years?
In year 1, you need something to live on. The average for 1 person in the US is half that of a family, say $31,000. $150,000-$31,000 is $129,000 left working for you in that mutual fund.
$40 for clothes? I’m dyin here. Notice you could put some housing aside from maintenance and insurance and taxes here. Transportation might be down as well. Food-$100? Really? No way. Not unless you grow it yourself prolly.