Wednesday, February 12, 2014

The Freedom Equation

Profit is defined by the equation below:

Profit = Revenue - Cost

Anyone would tell you that if you want to increase profit, you either increase revenue OR reduce costs. Of course, you would do better if you increase revenue AND reduce costs. It is a simple equation.

The equation to freedom has an extra component; growth rate of your investments. It determines how fast you achieve freedom from the corporate treadmill. Everything you need to know about escaping the "9-5 till you're 65 routine" is in the equation below. 

But that's only if you pay attention to each component (Income, Expenses & Growth Rate).

Freedom = (Income - Expenses) x Growth rate

And yes, it's that simple.

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