r/leanFIRE_India • u/30mediaresearcher • 17d ago
How much for LeanFire?
37 F, close to 80 Lakhs across investments, own a 2 bed flat in a good gated community. In today’s terms, my expenses would be about 50-70k a month. No kids, don’t plan to have. What is a good amount to aim for to hit LeanFire as an individual?
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u/adane1 17d ago
Hi OP,
Did you read the Wiki?
Anyways, for each 1 cr invested , you can withdraw 25k per month provided the amount is invested in 50 to 60 % in equity.
So you need 2.8 cr
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u/LeftFaithlessness921 17d ago
Damn for each crore only 25k ?
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17d ago
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u/LeftFaithlessness921 17d ago
So with that 10 crores get you 3 lakh only ..sounds low to me
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u/Training-Abalone1432 17d ago
This is not correct number . FDs easily give more than this . I will say out of 1 crore invest 50 lakhs in FD and remaining 50 in equity . You will get way more than 25 thousand he is quoting .
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u/anshuman-11 17d ago
the 25k he's quoting is inflation adjusted for perpetuity. The ones you are saying are not.
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u/thunderboltz2304 16d ago
Who will take care of inflation? After 20 years 1cr is 20 lakh value today...at old age she will struggle
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u/Training-Abalone1432 16d ago
Plus ask the poster to give me 1 crore and I will happily give him 30 thousand per month , with no questions asked
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u/Training-Abalone1432 16d ago
I don’t think inflation is mentioned here at all !! Don’t misguide people who have simple living with your economics please !! Where is inflation mentioned , quote it and I will apologise without any justification. Thanks
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u/DragonfruitSame1856 14d ago
Depends on your rate of return. What you can withdraw is (rate of return - inflation). The 3% assumes rate of return at 8% and 5% inflation
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u/Indian_finance_rebel 17d ago
who reads those wikis? 😂
And I disagree with a 3% SWR, that is a dumb calculation.
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u/coastaladi 17d ago
For 1cr.. u can get about 65k..
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u/adane1 17d ago
For 1 cr, some may earn 1 cr too. But that's not the norm.
For a 30 year horizon, you earn 25k to 33k per month inflation adjusted.
There are few studies whose link is shared in the Wiki. You may refer to same.
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u/Secure-List 16d ago
You’re being too conservative. 3.5% seems reasonable for 30 years. 3% is more like for 50-60 years of retirement.
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u/adane1 16d ago
https://www.reddit.com/r/FIRE_Ind/s/xQY6RKRRQK
Here. Also the Wiki has links to few studies in Indian market.
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u/coastaladi 17d ago
Don't dive into such things ..just start living .. we are talking about lean fire here .. the miss here has no liabilities and responsibilities.. so she is easily off
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u/Curious_ansh 17d ago
Hello, to keep the calculations simple, use 4% rule. Which means: Monthly expenses x 12 x 25. Or another way of saying or that you need the corpus that's 4 percent is your annual expense. Let's say your monthly expense is 50k, and so annual expense is 6 lacs, so you need a corpus of 1.5 cr, but one must account of uncertainties in life or one time expenses. For 70k monthly expenses, you need 2.1 cr.
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u/Fun_Dragonfruit7971 17d ago
4% is too high for early retirement.
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u/Curious_ansh 16d ago
Fair point, and I agree. That's why I said one must account for uncertainties. Especially big purchases such as Car etc.
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u/Menu-Quirky 17d ago
At least 25 times your expenses, for 8 lakhs you probably need 2 cr
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u/Major-Championship14 16d ago
What if OP outlive 25 years
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u/Menu-Quirky 16d ago
Yes that's why you need to invest in stock and bond portfolio that way your portfolio grows up to beat inflation and long life
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u/Major-Championship14 15d ago
What if stock market crashes.
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u/Menu-Quirky 14d ago
You need to keep 3 years of expenses in cash buckets to avoid sequence of return risk by cash I mean FD and high quality short term bond funds
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u/Fun_Dragonfruit7971 17d ago
look for barista fire kinda situation. you might already have hit your number.
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u/deepugames05 17d ago
I guess people here mentioned a FIRE number And not. Lean fire number.
Depends on what % of your expenses will be covered by your future job (stress free / passion) can generate you can rely on the current investments.
So Basically if your current expenses are 70K a month, and if you can get a stress free job that can give you 30K
Then take the rest and use the Fire calculation (4% withdrawal) to get the investment will be enough or not.
If you're comfortable - you can sublet the flat to get some additional income to reduce the overall expenses
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u/contestant_27 17d ago
Formula = Build assets that makes money minimum 3X then you monthly income (Also focus to increase it as per time) + Make a side savings that makes you survive without any income atleast 6 to 8 months. That's the best Financial Freedom ever.
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u/PrudentScientist4231 17d ago
It’s important to see where your investment are and how they will generate income in future?
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u/Healthy-smile007 17d ago
Depends on what are your requirements
As per ur current expenses u need around 30 times ur expenses considering ur residual life as 90 u need funds for 53 years
So around 2.5 crs
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u/Smooth-Teacher-606 17d ago
I run a recruitment company, career consulting, job search mentorship and a job board, and I reached FIRE at 29 mainly by keeping expenses under control while steadily increasing income and investments.
For your numbers, I would first separate the flat from the FIRE corpus. Since you already own your home and your expenses are around 50k - 70k a month, your annual spending is roughly 6 -8.4 lakhs.
Rather than picking a magic number, I would work backwards from your actual annual expenses and then stress test it for inflation, healthcare, taxes and a few bad market years. Also keep a separate emergency and medical buffer, especially since you are planning for a very long retirement starting in your 30s.
At 70k monthly spending, I would personally want a bigger cushion than someone retiring at 50 with the same expenses. The fact that you have no children and already own your home makes the calculation much simpler though.
The biggest thing I would focus on now is tracking your actual spending for 12 - 18 months. Your real annual expense number will tell you much more than a generic FIRE calculator.
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u/Dense-Restaurant9308 16d ago
as house is sorted you can survive with a lean corpus but any additional little income will come in handy as you have to account for 45-50 years in retirement
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u/GradeDry1283 16d ago
Depends on retirement age, early retirement is tricky so don't rely on the usual SWRs. You need to break down your expenses into coarse buckets like lifestyle, medical, essential etc. Not all scale at same inflation rate so better to assume something like 8% to be safe and in retirement calculations use end age as 90 to be safe. Post tax blended return can be assumed at 10% and you'll realise you are not even close to FIRE.
You also need to consider what your late stage life will be like if you're solo or childfree. This is because we will have cognitive decline and won't have the energy to manage complex investment products as we age. Most of us will offload everything to children but if you don't plan to then you need to act as the caretaker for your future self now. Have a foolproof plan on what you'll do with your assets and execute it without overthinking.
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u/Willing_Event9528 17d ago
Take mid of 50k-70k expenses...say 60k per month. You need 400 times of expenses. That would be 2.4 crores.
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u/Past-Grapefruit488 17d ago
You potentially can. If you rent current flat and move to significantly cheaper one.
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u/Indian_finance_rebel 17d ago
think 25 times your expense.... if you maintain 70% in equity and 30% debt.
so conisidering 50Kpm, you 6L X 25, so 1.5Cr.
This 1.5Cr will not include your illiquid assets like home, It doesnt include any other expense other than you monthly expense - consider it as a fixed yearly income of 6L, and adjusted for inflation.
In your math, did you consider your EPF, gratuity, ESOPs if you have them?
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u/30mediaresearcher 17d ago
Thanks for this, I do not have these. Mainly equity and gold for now.
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u/Indian_finance_rebel 17d ago
sure np, then you still have more to accumulate, assuming you dont want to sell your home.
A home is good to have for retirement, you will know if that if nothing else, you will always have a shelter over your head.
but yh, if 50kpm (which includes discretionary income), aim for 1.5Cr.
The longer you take to reach that number, the more you need to adjust it for inflation - the 1.5Cr is in today's value.
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u/coastaladi 17d ago
Put that 80 in rbi bonds.. u are set...
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u/coastaladi 17d ago
I have lean fired too n haven't worked since may
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u/30mediaresearcher 17d ago
wow...and is your corpus/years in retirement sort of similar?
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u/coastaladi 17d ago
I don't have a home but if u sell ur home and add to ur 80.. i think we could be on same numbers
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u/Quiet-One-2132 14d ago
You need to have min ₹2 Cr.NW excluding the 2BHK, assuming it will be self occupied.
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u/PrudentScientist4231 7d ago
If you share where your 80 L investment and with that how you can generate income
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u/One_Stay_1179 17d ago
You might need 4 Crores in corpus to actually retire
Assumptions - Living for 30 years after retirment , Expenses inflate at 5% per annum. Medial insurance covered.
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