I have $100,000 in my equity portfolio. A conservative estimate for my savings each year is around $30,000 a year. Given these figures I can calculate how much I will have in 10 years, depending on my return.
|YoY Return||Expected saving per year||value of portfolio in 10 years|
Even the lowest estimate is enough for me to retire in India; if I aim for $12,000 in yearly spending (2.2% return suffices). The high estimate is probably going to be very difficult to achieve. I am targeting 30% return — which will be very difficult. But a high target is going to help me weed out low margin of safety investments. I want the undervaluation to be enough to warrant 30% return.
A conservative estimate is around $40,000 saving every year and a 15% return. With a starting portfolio of $100,000 today; this gets me to: $1.2mn.
My goal for 2013 are:
- Save $40,000.
- Target 30% return.
- Never go below 20% cash.
I will see if I achieve these this year or not.