How Much Is "Enough"?

[Bryan Hancock]

So life has been good since the mortgage crisis doldrums.  Projecting growth over the coming years it is clear that we'll do well if things go as expected.  At the ripe old age of 36 I am beginning to think about "retirement" and what I would like for an average day to look like going forward.  I have probably worked 80+ hour weeks for the last 3-4 years and the benefit of all of this hard work is starting to pay off.  It seems silly to keep working this hard going forward given that we probably have "enough" now to start living the life of our choosing without all of the drama and hassle.  

Given that real estate investing can be very lucrative it will be hard to stop investing.  I am thinking of dialing things back some or diversifying where my investments are parked.  Doing something new and exciting may be worth investigating too.   

At what point do you feel like you have enough FU money to dial things back and stop working so hard?  25X annual expenses seems like a common litmus test, but for real estate investors it may need to be lower given that the investments are quasi active.  

Any thoughts?  

[Trevor Ewen]

@Bryan Hancock

I like the 25x annual expenses litmus test. I think it's a pretty good benchmark if you are going for a standard cost of living and aiming for wealth preservation and reasonable value in your investments.

Some people take that opportunity to go more passive. Get managers working for you, or even get into private lending. Travel the world, maybe write a novel.

For me, the lack of intense activity would not be my cup of tea. I want to use that opportunity to pursue bigger problems, whether they be in urban revitalization, tech, or international development.

For me, financial freedom is a chance to be free from the rate race, but not a chance to be free from investment. Ideally, I want to move into impact investing. Because this is wrought with peril (I know, I have seen many of these not work out), I am aiming for higher than 25x annual expenses. That way, I am not 'impacting the world' with my family's financial future. Instead, I want to use the icing on the cake.

I think that drawing a line in the sand is a big part of living intentionally. There are some great thoughts from Aaron Walker in this podcast from Radical Personal Finance. Check it out, makes a great case for living intentionally once you have mastered the business.