How much money do you need for financial freedom?
I cannot answer your question, but I can give you some ideas!
1. YOU DO NOT HAVE TO STAY IN A EXPENSIVE COUNTRY and be flexible
One thing is called geoarbitrage. Geoarbitrage is about finding an affordable place to live that has currency rates and taxes in your favor.
A country's cost of living can be measured by looking at what they are willing or able offer you, which may not always include money alone but instead includes things like quality services offered at low costs yet still providing great benefits; if this sounds good then it might just work out well for those who choose geo arbitrage as their lifestyle choice!
Why is this important? After I decided to move abroad in the future, I will easily manage to live off 5000€ in e.g. Southeast-Asia. Right now in Ireland you spend more than 2500€ for rent in a bigger city to get a comfortable flat with a family, alone living expenses are much higher. So why not being flexible.
2. Make your calculations (simplified):
With the old economy investment even high dividend yield, it was ~5% APY. Order to reach my goal of 5000€ each month, I needed to have 1.2million invested. Quite a sum for a single person.
You can use this formula for your calculation
Initial Investment amount needed = (Your needed monthly income * 12) / APY% - Just copy this with your number into google search bar ;-)
e.g. (5000*12)/5% - copied in Google equals 1200000
So even with just the stablecoin yield of USDC or USDT from Crypto.com of 12%, my initial invest reduces to 500000€. More managable right?
With all the possibilities and more higher risk yields of 20-40% on stablecoins are also viable, cutting my needed money even more to 200000€ (30%)
So if you are a single or frugal and are content with living off 1500€ a month, you only need 60000€ to achieve your personal freedom (30%).
3. Do not put all your eggs in one nest - Diversify!
Although it is very tempting to put all your money in one investment, I strongly recommend to diversify your assets. Never invest more than you can live without. After building more, use the compound effect to diversify in old economy and or other new economy options.
Your initial invest is calculated (very simplified)
(Your needed monthly income * 12) / APY%
Feel free to comment your Initial invest and remember, only you know how much you need in order to live your life!