REVERSE ENGINEER YOUR RETIREMENT

As with all of my short and long term plans, I reverse engineer the end result and work backwards to determine the intermediate steps. 

It's like planning a road trip: you know your destination and reverse engineer the streets back to your starting point. 

The same principle applies to money, finance, and real estate investing.

Take a look at this Compound Interest Calculator and plug in Age 40 at 5% interest with an initial investment of $100,000 (leave the monthly savings amount blank).

In 25 years, that $100,000 will compound exponentially to $348,129, but that is not going to be enough to fund your retirement.

Now change the interest rate from 5% to 15% and see what happens: compounding double-digits produces a twelvefold increase to $4,154,412. 

My plan is to eventually move into an assisted living facility and these vary between $3,000 to $7,000 or more per month.

Let's go high end and extrapolate $10,000 per month over 20 years = $2,400,000, and that's the amount to reverse engineer today.