TheRIT wrote:17 years is a bit longer than my 9 years but make sure you model what you might expect compound interest to deliver as I received quite a surprise as only 38% of my wealth came from compound interest while 62% came from saving.
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If I understand correctly your 38 years old today, your at a 40% gross savings rate and you only think you can FIRE in 17 years. With a bit of critical thinking I'd challenge if you might just be able to do a bit better than that. In comparison I started when I was 34, became FI only 9 years later at age 43 and will FIRE next year under current plans.
Unfortunately, I'm not earning as much as you did before you FIREed. If the pay rise pans out, I'd be able to save an additional £20k, which would reduce my working life substantially. Without the extra income I'm going to need to rely on compounding to build the po tover a longer timeframe.
By my projections a ten year period would see 50% of returns come from 'interest'. That pot of 150% would then double over the next ten years, due to compounding. I'd then add another 150% by investing and growth during the second ten year period. This would give a total of 450% - of which 250% would be growth.
This is based upon a return of 7% and a 20 year investment period. The ftse 100 has an average return of 9% over the past 40 years.