How Much Will You Need to Live on Your Investments? Use This Equation!

“How can I quit my job and live on my investment income streams?”

This is a massively more complex question than it first appears. At the most conservative level, the answer is “enough money to pay for everything you’ll need to buy for the rest of your life.” But, of course, the real answer depends on a lot of factors. Let’s make an equation.

• Take the total amount of money you need to live a full life for a year. Let’s call that y for “a year’s worth of expenses.”
• Take the total amount of money you need to spend to maintain every property in your portfolio for a year. Let’s call that m for “maintenance costs.”
• Take the amount of money that you make in profit in a full year of property investment. Let’s call that i for “income.”
• Subtract your age from 90. We’ll call that l for “anticipated lifespan.”
• And we’ll call the total amount of money you need in the bank $ for obvious reasons.

So the amount of money you’ll need to make, in the abstract, is:https://www.biggerpockets.com/renewsblog/equation-live-on-investments/?utm_source=newsletter