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Monday, January 25, 2010

Limitations You Argue for Become Real

I received a nice email from someone sharing with me a message board's thread that discussed the reality of living on a million US dollars. In the thread, a link to our site was given as a reference to the discussion (thank you crashjr!).

This thread, titled If you had 1M dollars to live off forever could it be done and how?, has 11+ pages of posts of people arguing for and arguing against the possibility. As I read all the reasons why it couldn't be done, I was struck by the negativity, vehemence, and forceful "NO WAY!" posts. Yes, I live in a sheltered Intenet world where I tread in only positive upbeat places, so seeing so much negativity was quite unexpected.

All of the pundits saying "No" had so much passion behind them. I have zero doubt that those people could not possibly do it. They argued hard for the limitation; therefore it is their limitation and it is doubtful they will ever be able to beat it.

The thread author's post magnified the question, if you were 25 could you live off a million dollars the rest of your life without working? I'm not 25, I'm 40. I have no doubt that it is possible at 40, and even with 2 young children, to have a million dollars and not work the rest of your life.

To answer the original question, I have zero doubt that if I were 25 years old today, with the knowledge and experience I've acquired at this point in life, I could easily live off $1,000,000 the rest of my life without working in the traditional sense.

The how part is tied to knowing what makes me happy and how much I live off of today. If I shared how much our family actually lives off of, as captured by our actual spending statements, most readers would be shocked. I know my friends are when I share the numbers with them.

The fact is, living a happy, fulfilling life with all of trappings of modern life can cost you less than $25,000 per year. Living the life mass media, popular culture, and commercial industries want you to, however, can grow without bound. In fact, it is only bounded by how much one earns.

If I were 25, single, and I had one million dollars, this is what I would do:
  • spend $25,000 on a nice used 30 foot sailboat, paying for it in full
  • put the remainder of my money away in safe investments earning 5%
  • aggressively convert all my money into inflation protected securities from multiple countries, as the law allows in those countries
  • board my boat and enjoy a life of adventure and voyaging at a spend of $15,000 per year for 7 years
  • After the 7 years, if I hadn't found the right woman yet, I would begin searching for my life mate
  • The right woman would be one whom is comfortable living with me on this tiny boat, and we would until I was 35, off the $15,000 per year. No adjustments to the amount, only to the lifestyle
  • We would then sell our 30 footer for $25,000, and buy a 40 foot catamaran for $75,000
  • We would have children and up our yearly spending to $30,000 per year
  • After the children are grown, and I've kicked them off the boat, we would sell our catamaran for $60,000 and buy a 50 foot trawler for $100,000
  • For the next 30 years, my wife and I would putter around, living off the remainder of the money ensuring that when we were 95, we would have exactly zero dollars to our name
  • When the 30 years is up and/or we hit 85, we would sell our trawler for $25,000, and move into a old folks retirement community
  • At some point we would expire
Well, that's what I would do. :)

Don't argue for limitations.... otherwise, you will always be bound by them.


  1. I really like your clear and concise thinking and really am appreciating your gift of making lists!

  2. @Travis and Maggie: Thank you. Being a planner at heart makes it easy to create lists.

    It is interesting how I had never unleashed this innate talent to our own life until we started our quest to take this trip.

    As part of my professional job, I spend hours and hours thinking through how to accomplish large scale multi million dollar efforts. I would document them in minute detail. I would create strategies. I would address tactics. I would address all risks. I'm very good at this.

    In my personal life, I would plan. We always did plan, but I never applied the same level of rigor to our personal life. What was/is silly is that our personal life is far more important than work! If there was a place for this inborn skill, it is my personal life.

    Now that we have unleashed it, our dreams are coming true.


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