What’s your number?
No. Not your phone number.
No. Not your body count (vulgar cultural reference used by young people).
Another friend said:
for me it often means what number of wealth do you have to get to that makes you comfortable with now doing whatever you want.
I came across this article two weeks ago. Also, my friend Maaria is building The Four Languages - a framework for personal + professional growth predicated on synergy between the Mind, Heart, Body & Soul - and she kindly invited me to give a “holistic finance” lecture next month … so the question has been on my mind.
Now that I live back in the leafy + lovely suburbia where I grew up, I think a lot about how much formal financial training I have had and how virtually none of it has covered personal finance. Nothing could be more important, yet the subject wasn’t covered at university in America, nor my MBA in Britain - the two most influential colonial forces in recent memory.
So what does that tell you?
You need to figure it out for yourself - nobody is looking after you except YOU.
At the end of 2024, the average equity allocation for workers in target-date funds just beginning their careers was 92%, according to Morningstar, up from 85% in 2014.
Why does this matter?
When the average equity allocation in a retirement fund is a whopping 92% for workers it means that people are investing praying that their hard money will be able to outpace inflation.
Finance people might say because of the time value of money.
But in the absence of inflation - the discount rate is simply the rate required to hit your number’s net present value!
And there IS INFLATION !
Lots of it.
And none of us can predict it.
So the only sensible solution is to plan / hope to …
How do I pick a number?
Figure out your annual net cash burn, predict when you will stop working and when you will die.
Back of the envelope: that is your floor number.
How much is enough?
It depends on the lifestyle you want to lead.
I know people who:
for the last 10 years, have been raising two kids on a boat that has circumnavigated the globe multiple times. (not a yacht - more like van-life on the high seas)
sold all their stuff and live in a trailer park in Florida
have growing balance sheets but still feel like they are in a rat race
have income statements but no balance sheets and happy as clams
You get the drift. Different strokes for different folks.
There is no bad lifestyle choice - as long as you are living the lifestyle YOU WANT …
… and can afford.
Be honest with yourself.
Run some numbers.
And then plan accordingly.
Accept all luck along the way.How do I achieve my number?
I’m still finalizing content for my Holistic Finance talk on September 16th. If there are any subjects you are interested in exploring, please let me know.
Did you know that The Verve / Richard Ashcroft did not see a penny of their 1997 hit Bitter Sweet Symphony until 2021.
The royalties from the song went mainly to ABKCO, the management company founded by former Rolling Stones manager Allen Klein, after a legal dispute in 1997, not directly to Mick Jagger and Keith Richards. For over 20 years, Klein and ABKCO held the publishing rights, receiving the money until May 2019, when Jagger and Richards agreed to transfer their share and songwriting credits to Richard Ashcroft.
It would be cool to see a viral trend using the song to pad the royalty stream for these guys.
In Summary …
We see humans “co-opting” the art of other humans in this case. If you had a chance to read this - you might notice a frequency in such abuse.
Do you still think that we need to fear AI usurping creative competence - or perhaps it is just other humans we need to be weary of?
Survival of the fittest.
