Extremely Simple FIRE Math

In partnership with

Do you like Brian Tracy books?

Tracy, a business coach, often gives simple, common sense advice. But, in the words of French philosopher Voltaire, “Common sense is not so common.”

When it comes to setting goals, Brain Tracy advocates writing down exactly what you want to achieve and then breaking this big goal down into multiple, smaller steps. Sounds simple, but many people never do this.

When it comes to dividend investing and financial independence, you can set a small goal to raise your annual dividend income by $___/month and then multiply this by 12 to figure out how much passive income you should receive over the course of one year.

Here’s an example…

You buy enough dividend stocks each month to raise your dividend income by $25 per year. After 12 months of this, you’ve increased your annual dividend income by $25 per month, or $300 per year.

Raise your dividend income by $100 per month, and after 12 months you’re netting $1,200 per year. Do this for 10 years, and you’re now making $12,000 per year off dividends alone — a conservative figure that doesn’t account for dividend raises or reinvested dividends.

Even small monthly dividend increases add up. If you set a goal and take daily action, your efforts will compound over time. You might start with a goal of increasing your annual dividend income by $25 per month. And pretty soon, your dividend income is large enough to cover your yearly Netflix subscription or your daily coffee run, or maybe your annual Kindle and used book purchases.

Then, later, you’re earning enough to cover your utility bills.

And after that, your dividends pay for groceries. Then restaurants. Then rent/housing. Then all your your expenses.

I bring this up because there’s a perpetual maelstrom surrounding the world of financial independence. Actually, that’s incorrect. Things are even worse. There’s a perpetual maelstrom surrounding the very concept of financial stability.

Log on to social media or turn on the news, and you’ll see an endless series of reports citing how it’s impossible to get ahead in today’s economic climate.

Meanwhile, just getting started — even if it seems daunting — is half the battle.

If you invested into quality dividend stocks each month and consistently raised your annual dividend income by $25, $50, or $100, you’d slowly start to expirience “the miracle of compound interest.” And pretty soon, your small but consistent increases would grow into lifechanging money.

200+ AI Side Hustles to Start Right Now

From prompt engineering to AI apps, there are countless ways to profit from AI now. Our guide reveals 200+ actionable AI business models, from no-code solutions to advanced applications. Learn how people are earning $500-$10,000 monthly with tools that didn't exist last year. Sign up for The Hustle to get the guide and daily insights.

Get the guide

Disclaimer: This article is for entertainment purposes only. It is not financial advice, always do your own research.