The financial freedom number is simply taking your monthly total passive income and subtracting it with your monthly expenses.
Financial Freedom Number = Monthly Total Passive Income - Monthly Expenses
A negative number would mean that you are still not financially free and would need to make up for that number in terms of passive income to become financially free. Let's take for example my scenario:
I have $224 in monthly total passive income and $3887 in monthly expenses. My financial freedom number is thus -$3663. That would mean to be financially free, I will need to make an additional $3663 per month in terms of passive income to maintain my current standard of living (without accounting for inflation).
This is enlightening. First it means that in my initial financial freedom goal, the sum of $2800 per month that I was targeting is not enough for me to be financially free. That is unless I continue to reduce my monthly expenses to $2800 or less.
There you have it, a simple way to calculate your financial freedom number. Mine is -$3663. What is your financial freedom number?
Other Articles of Interest:
What is Financial Freedom to You? This is my own definition of Financial Freedom: My Financial Freedom Goal
