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Most people likely relate wealth to net worth. I know I do. Net worth is defined as:

Net Worth = Total Assets – Total Liabilities


Kim Kiyosaki, wife of Robert Kiyosaki who wrote Rich Dad Poor Dad, wrote a book of her own, Rich Woman. She has an interesting way of looking at one’s wealth: ‘A person’s ability to survive X number of days forward‘. By her way of looking at it, you would:

Step 1: Calculate your total monthly expenses

For me, my total monthly expenses (housing, transportation, food, personal care, entertainment, and other) is around $3,500, and I can pare that down to $2500 to extend my savings.

Step 2: Calculate how much money you have (I exclude retirement monies, she doesn’t)

Savings – $31,000

Home – illiquid asset

Step 3: Divide money you have by your total monthly expenses (Step 3 = Step 2/Step 1)

$31k/$3500 = 8.85 months.

$31k/$2500 = 12.4 months.

$11k/$2500 = 4.4 months (this is post-investment project)

This is a comfortable number for me to have saved up, except post-invesment project. I will have to plan to squirrel away extra cash to increase my savings once we’ve gone ahead with that venture.


This truly puts my net worth into perspective for me.


The ultimate goal is to increase my passive income, which for me is generally going to be savings and 401(k) while paying off the home as quickly as possible. This gives us a lot of freedom in our later years.


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