The 25x Rule

The rule of 25 serves as a straightforward guideline for achieving financial independence, often synonymous with retirement. This principle suggests accumulating savings equivalent to 25 times your planned annual expenses upon exiting the traditional workforce. For instance, if monthly expenses amount to $7,500, totaling $90,000 annually, multiplying this figure by 25 yields a retirement fund target of $2,250,000. While this formula provides a helpful starting point for estimating financial independence goals, it’s crucial to recognize its limitations and consider individual circumstances.

*It’s important to remember, as discussed in previous blog posts, that the concept of retirement isn’t explicitly outlined in the Bible. Instead, the emphasis lies on recognizing that the Lord has individualized plans and purposes for each person.

-HC