05-27-2008, 07:11 PM
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$ Saving Jr. College Student
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Join Date: Feb 2008
Location: ohio
Posts: 417
Points: 2280.00
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Quote:
Originally Posted by ea1776
I like that formula too, but keep in mind, that this is how they define "P.A.W."s in the book (Prodigious Accumulator of Wealth), or wealthy individuals.
Here is more information on that excellent book:
The Millionaire Next Door - Wikipedia, the free encyclopedia
Here is a calculator for that equation, with more info on how you stack up:
http://www.banksite.com/calc/wealth
I'm 25, and according to the equation, I am not a P.A.W..... 
YET!
A really cool equation would be to figure out what percentage of your income you would need to save, at what rate-of-return, and for how long... to "catch up" with the Millionaire Next Door P.A.W. equation.  Any takers? |
Do not use this formula if you are young like you are. It makes no sense at all. Let's say you are 22 years old and just got out of college and got a job making 35K a year. By this formula, you should have over 77k. That is ridiculuos. |