July 5,2004

Determining what you want is key in determining how much you need to attain the lifestyle you want. What you want determines everything else. I was pondering this issue lately, because I have realized how few of us actually know what we want. I mean we think we know what we want, or we think we know what we would want. Or, we want what we are "supposed" to want, the big SUV, nice big house, expensive clothes etc. I don't think we really want all that, parts of it, yeah, but not all of it.

I don't even think people really want a million dollars, even when they say they want it. What they want is the freedom a million dollars would bring them. The thing is, you can get freedom without the million dollars. With a paid home - you can live like a millionaire with $4 -500,000 dollars properly invested. No kidding. (At 8% annual earnings that’s $40,000 a year!) I know most people would be quite content with no mortgage, basic bills and $40,000 a year without working. Heck, if you pick up some part time or seasonal work you enjoy and enjoy semi-retirement for a while you can live quite well and continue to build wealth.

The key is to squeeze the most out of your money and make sure on the fixed expense side that costs are as low as reasonably possible.

For the average working person, this goal is totally achievable. This process costs about the same as buying a "really" expensive home for your income, but instead you have a reasonable home and income producing investments.

I think I would rather live a bit more modestly, and not have to work .... Instead of spending money to go to work, I'd rather spend it playing and having fun! (or doing the kind of work I really want to do!)

So, I guess you could say I want to have the freedom of a millionaire at half the price, and I think that’s OK!