Monday, March 31, 2014

Progressive Retirement

This is what $20 can buy.  
It was on a backpacking trip in the south of France, that I realized the currency of travel.  $20 a night gave me a hilltop beautiful view of Nice and unlimited travel opportunities in southern France, Monaco, and Northern Italy.   $20 landed me in paradise for one night.

When I got back to the States, I started calculating the things I wanted in terms of nights in paradise.

A new shirt:  2 nights in paradise
Dinner out: 1 night in paradise
A new backpacking tent:  15 nights in paradise
Skipping a latte for a week: 1 night in paradise

It made me rethink the way that I spent money.  Do I want another object that takes up space, or another night in paradise.

It got me thinking, what if I calculated financial freedom in the same way.  For every $400 invested into stock A, the dividend produced equates to working one hour of my day job.  Therefore, every $2800 invested replaces one 7 hour work day.  Put into those terms, it looks almost easy to buy myself out of working.  Instead of spending the $2800 on a fancy vacation that lasts only a week, I can buy myself an annual vacation day forever.   Instead of retiring at 65, I can progressively retire, one hour at a time.

**I am not a financial adviser.  Please seek professional advice before making financial changes or investments. 

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