The numbers that could let you retire decades earlier

Each week the NZ Herald's Cooking the Books podcast tackles a different money problem. Today, it's the financial independence movement, and whether normal people can give it a try. Hosted by Frances Cook. <br /><br />Financial independence is something you might have seen floating around, and been curious about. <br /><br />On the face of it, it sounds too good to be true. Save and invest hard, and you build up enough investment income that you don't have to work anymore. <br /><br />Surely that's something that's only possible for rich people? <br /><br />It's open to more people than you might think. <br /><br />Here's the maths behind it. The idea is that you work out how much you need in a year to live the life you want. <br /><br />So you might be happy living a very frugal lifestyle, which always makes things easier. Or you might enjoy some of life's nicer trappings, and want to keep them.<br /> <br />Whatever that number is, you need a nest egg of 25x that, then the idea is that you can withdraw 4% of it each year, in order to live that lifestyle you like. <br /><br />For the latest podcast episode I talked to financial planner Liz Koh from Enrich Retirement.<br /><br />We discussed whether the maths behind the idea works, the different types of financial independence, and tactics for the average person to get there. <br /><br />If you have a question about this podcast, or question you'd like answered in the next one, come and talk to me about it. I'm on Facebook here <a href="https://www.facebook.com/FrancesCookJournalist/" rel="noopener">https://www.facebook.com/FrancesCookJournalist/</a> Instagram here <a href="https://www.instagram.com/francescooknz/" rel="noopener">https://www.instagram.com/francescooknz/</a> and Twitter here <a href="https://twitter.com/FrancesCook" rel="noopener">https://twitter.com/FrancesCook</a>