My definition of passive income is money that arrives to me without me doing anything to realize it - so long-term capital gains from selling a stock isn't counted and unrealized gains certainly aren't. Also not included is anything that happens in a retirement account. But I am counting the net profit from cash takeover, like the Powertel takeover by Telecom NZ, in passive income. The other categories of passive income should be obvious. Projecting for the year I should receive bigger mutual fund distributions in June and December and a similar size one in September. I expect to receive about the same amount again in dividends and we could multiply interest by three. There is one takeover maybe in the works, but the payout will be about $1500 in net profit. So I could project about $23k for the year. Trading is very hard to predict. Maybe I'll triple the numbers or maybe I'll blow up like I did to some extent last year. If I tripled the numbers I'd have $33k for the year. With expenses of $25-30k per year (and not counting stuff like health insurance that my employer mostly pays for now in that) and considering taxes I'm just on the edge of "financial independence". But I can't afford to make too many mistakes or I'd start cutting into my capital.
2 comments:
your expenses are 30k per year????
is that just you or you and the wife?
regardless, congrats on your near-financial-freedom.
I spent $26k last year not including health insurance. Just me. Is that a lot or little?
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