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Well, first we'll take the conservative approach, and then the not as conservative approach. Both examples assume you can live on $16,000/year. If you need more, replace the $16,000 with your number when calculating:
- If you think you will only receive a 6% return on your investment, then your nest egg should be around $267,000. That's figured by dividing your annual needs ($16,000) by 6% (.06).
- If you think you can get a 10% return on your investment, then your nest egg should be around $160,000. That's $16,000 divided by.10.
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