The Strategy

As boring as this may sound, but the whole idea is, in fact, a pure numbers game. The whole point of escaping the rat race is about time and freedom. There may be many definitions of freedom, but one certain aspect of any of these definitions will at some point include financial independence.

Here it gets a little tricky. The definition of financial independence is different for every person. If you live in Chile or Thailand it will be a different story compared with a person living in the UK or Singapore. And if you grew up in a posh one-family house it will also be a different story compared to someone who grew up sharing one room with the entire family in a small condo.

Therefore there are plenty of decisions involved to move towards independence. Let me tell you then how it could play out: A nice small house with a garden and car in northern Thailand. Healthy local food, going out for lunch and dinners and the occasional domestic trip to Phuket or Bangkok for some beach or shopping. Full private medical insurance and some candy for my daughter. The expected cost of living to cover it comfortably: approx. 2.000 EUR / month or 80.000 THB – after tax. Now, this is how we got to calculate this:

  • 2.000 EUR per month means 24.000 EUR per year.
  • A regular working week covers 40 hours.
  • A year has 52 weeks
  • So we are talking about (24.000 / 52 / 40) = 11,54 EUR / hour
  • This is calculated obviously AFTER tax

So the goal is clear: How can I get 11,54 EUR / hour for (52 x 40) 2.080 hours per year. Since I am talking about NET income, your tax rate will become a very important factor to get the numbers right.

Now, the strategy to get there from my point of view is the following:

  1. A successful career to create initial savings
  2. Getting started in the stock market to start creating passive income from dividends and stock appreciation
  3. Re-invest every penny from the dividends and stock appreciation back into more stocks, to create the benefit of compound-interest on stocks
  4. Find a side-hustle, to create additional income streams
  5. Do your own thing – to do what you actually like to do, wherever you want to do it and as much as you want or need to do it.

There are of course a few more steps to consider in between to either make it easier or faster or better but this is the basic strategy. These are the main steps to consider and this is what this blog is all about.