The journey for financial independence and the naming of a pile of money
If our yearly costs and taxes (capital, property tax etc.) is defined as X then X = The sum we need yielded as dividends each year. This is really the definition of financial independence.
For whatever reason we decided to name this pile of money, and for even more unclear reasons we decided to name it The Leprechaun. This is not from some weird fantasy or fairy tale, we just named it out of the blue. This is because we need some named-entity to name the adventure. As having a certain amount of money in an bank account is an end-goal, but the journey and the challenge that comes with it. Just imagining the opportunities when becoming financially independent is scary as well as the choices we have to make their is also part of it.
So, the Leprechaun need to have an expected dividends yield totaling our combined costs and taxes.
On average, Swedish stocks will return about 4% of share value in dividends each year, so it is fairly realistic to assume the Leprechaun will need to be X/0,04 (plus some semi-horrific tax calculations on top of this). For you whom have already created this leprechaun of joy, why not start living the financial freedom and put the money in some of the companies listed as Swedish companies with best dividends.
This way, the growth of the portfolio (sorry, the Leprechaun) will be able to match/outgrow that of the expected inflation, creating a Leprechaun that will never die, as I triumphantly pointed out after having finished our excel spreadsheet with our strategy on.
This strategy in itself is fairly standard as posted Financial Independence: My investment strategy in 4 easy steps. There is absolutely nothing in it that I would assume not almost every FIRE-advocate follows. The main differentiator for us is that there are quite a few implications related to taxation in here (as well as the benefits of a welfare state and never having to pay for health instance for instance). I will dig in to our specific financials in the posts to come.