The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: mr_orange on September 01, 2015, 06:55:31 PM

I have started thinking of a "freedom point" as 1% of the total stache needed for FIRE. So with a 4% WR and a given amount of annual expenses targeted for FIRE a freedom point would be:
(Annual Expenses / .04) * .01 = 1 Freedom Point
You'd obviously need 100 of them to get to FIRE and it is simply one percentage point of your total stache needed.
What is a respectable amount of points to accumulate in a year to be considered Mustachian? Is 10 enough? That should get you to freedom in 10 years.

Given that definition, one "freedom point" is a quarter of your annual expenses. 10 of them then implies that you save 2.5 times your annual spending, or a savings rate of 71.4%. Those of us with higher incomes should be able to get there, but it's not realistic for everyone.