How much money do you need to retire in life?

Recently, someone said 40 crores. It’s gone viral.

I see a lot of FIRE or retirement corpus focused folks extrapolate life as a linear curve and try to compress life into some formula to achieve financial security. Assume a certain rate of inflation, assume your expenses to grow at some pace, what percentage you could earn at, and finally multiply that with a factor that feels safe enough. Few say 25-30x, few will say 50x, few maybe 100x too.

I too started this way, but I’ve realised it’s a very limited perspective of life. Life is about experience, growth, ebb and flow, acceptance, and overall, a journey that has no final meaning to anyone except to oneself.

So, how much does one really need? Should you really have 25x your annual expenses to feel safe? What if you don’t in spite of your best efforts? Are you a failure?

My own view is what I now call FLOW - Flexible Living Optimised for Well-being.

By all means, try to make as much money as you comfortably can - but don’t sell your soul in the process of doing so. You will realise you have a large retirement corpus, but no zeal to live life. You will be living a dead FIRED life.

Instead, do the best you can. You have to meet your expenses, hospital bills, education needs, savour the good things that life has to offer and maybe a bit more. Optimise for overall wellbeing over blind financial safety nets. Don’t be so obsessed about anything. Let life itself show you the path. Treat it more like an exploration than a peak to conquer. Be flexible, willing to adjust life as per situation, and always optimise for your overall wellbeing. FLOW any day over FIRE for me!

If you manage to only save 1crore, and you can earn 12%, with some safety buffer of ~20%, you can retire (I mean quit active earning work) if you manage to keep your expenses at 10L annually. It is not foolproof. Maybe you might be hit with cancer that might offset things. Who knows what life has to offer? Take it all. If you find it difficult to manage, maybe go back to work, maybe cut expenses further, or move to a village. Or sell all your assets. Do something that you can. Don’t fuss too much about it today. Trust your inner being to do what’s right for you at that point.

Don’t mistake me. I’m not saying one should undershoot. I don’t like poverty just as much as anyone I know of. Just that one should do the best they could while not compromising on life TODAY for a safer tomorrow that may never happen. In fact, the core point of all life is - there is no real security in anything external. Your life could be snatched away in a moment today! Embrace that risk. Accept it. Don’t try to conquer it - but understand it.

If you have money today, enjoy your money. Don’t splurge like there’s no tomorrow, but use it wisely. If for some reason, you are unable to save a large enough corpus, accept that too. Maybe you should just accept your circumstances and work longer, or cut your expenses, or both.

Life is not a linear curve where inflation grows at 6%, you earn at 9% every year, on an excel sheet. It is about ebb and flow. There will be times when you feel money just flows through to you, and things just happen in your life. You are wanted by everyone. There will also be times when that same flow will dry up, you feel insecure, maybe just got fired from your job and no one needs your skill anymore. Accept it all. That too is an experience worth going through. Remember, at the end, no one really cares about what you achieved - maybe except your family and close friends (and envious neighbours maybe). Who cares what Alexander the Great achieved by age 33? Or that simpleton called Dimitrios who died penniless doing nothing in life!

No one really cares about us, except us! And we seem to care excessively about ourselves.. and that is the problem. Take it lighter. Do the best you can, but don’t expect life to be a one-way street. Allow things to happen - good, bad, ugly - all of it. You will just be fine. Or maybe you won’t - but at least you’d have lived a life. Adjust as per situation. Be flexible!

In short, I tell myself these:

1. Life is about ‘experiencing’ - welcome everything that comes along in your life. Be a ‘witness’ of it all, enjoy it all and suffer through it all. Try to be a little detached from all of it as much as you can.
2. There’s no security in anything external. Don’t fool yourself with false securities. Accept life is about risk. Live through it the way you can. That’s enough.
3. Don’t live your life to prove anything to anyone, but to understand and experience life through your own curiosities.
4. Be flexible. If you make it rich, live a rich life. If you fall short, try to meet basics to keep your overall wellbeing intact - cut everything out. Be an ascetic if that’s what is demanded of you. Let the situation guide you. There are always things beyond our hands and accept it as the way of life.

Remember to FLOW.