## Financial Independence Calculator v2.0

In a previous post  I provide you a sheet. You could calculate how many months until you will achieve financial independence. I modified the previous sheet adding the effect of inflation and the increase in salary. If today I have expenses of 2000 euros it is unrealistic to think that in 10 years these will remain constant. I also expected that salary could increase in future years. I tried to calculate how easy it is to achieve financial independence. I imagined a rate of return on our securities portfolio of 7% inflation 2% and a wage that keeps pace with inflation. This shows that, although an ambitious goal may be, it is not an unreachable goal

you can find the new financial here

Enjoy!

## Financial independence: thinking to quit the rat race

Financial independence mean that you have a passive income (from a porfolio of stocks, bonds or other resources) and you can live without working, or if you prefer you can exit the “rat race”. What does it mean? According to Cambridge dictionarya way of life in modern society, in which people compete with each other for powerand money” This doesn’t mean you have to stop working at all. Probably you like your work in some ways but you don’t like your boss or some way or working or more simply you need more spare time to enjoy your life and do almost what you like. So financial independence doesn’t mean to watch tv all day long,  but get a new vison of work where you do the work you like simply because you like it. Enzo Biagi  one of the most important Italian  journalist  said “I would have been a free journalist too: thank goodness my publishers have never noticed it”. Yes if you are financial independet you can work for free.

## Financial Independence Calculator

In a previous post  I said that we have financial independence if passive income from our saving are greater than our expenses. To obtain this goal we save every month some money in some financial tools (stock, etf, bound, cryptocurrency…) with a yield. So suppose I have net salary from my job of \$2500 and \$2000 expenses every month, and I invest all my savings in financial instruments with 0.67% monthly return when will I be financial independent?  In this picture you maintain the money because the passive income are equal to expenses. Only inflation will affect your money. I’ll  be financial independent after 225 months

I provide a financial independence calculator you can freely use here

Simply change  green cell with your data

I recommenced to read this before starting your path to financial independence. “Why should I read Letter on happiness of Epicurus? are you crazy?”. The reason is very simple, because the financial independence is a path towards a better life style. So the first and most important question is “what make me happy?” “What happiness really means?”. Read and think what is real important in your life. Financial independence is only finance and math.

## Financial indipendence explained in 3 step

Financial independence is real simple to explain. If you have a job and you are a wise man problably you are in a situation like this

You have a job and income from it, you have expenses (bill, mortage ecc..) and if income > expenses you have saving. Simple

After that you can generate passive income from your saving (es if you buy stock they can generate dividends)  so the picture  can became like that

If your passive income = expenses you are financial indipendent so you can live

only from income from your saving without changing life style

If this is easy to understand the real question is “how can I achieve financial independence?” This is the main question but this trivial picture has more subtle question

## Our life as a path to independence

I found an nice post about financial independence, you can read here According to the author our life is a path to independence.  we are born dependent on the parents and achieve independence working.  Nowadays, most developed countries have systems to provide pensions on retirement so we achieve financial independence: we can live without working.  Unfortunately we are too old to enjoy life