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- Much of that corpus is inherited money
- You don’t have kids, who would otherwise have eaten away at the corpus
- You invested well in stocks and shares
In my own case, I took some big risks in the stock market and they are paying off now. I invested in companies in sectors like railways, defence and wind energy.
The questions you really need to ask are:
1. What is the lifestyle that you want to lead and how much would it cost you in maybe 15-20 years?
2. Education budget of children.
3. Your place of living.
4. Your medical bills.
5. How many dependents do you have/wish to have?
The gross estimate of FIRE is a 25x. I would be safer with a 35x - 40x which is what the West calls FAT FIRE. I believe this is a safer number because India is a growing economy and prices are going to increase. On top of that, I don't believe the 5-6% inflation rate either. Sectoral inflation is much higher and hence, 10-11% is a safer bet (assuming you wish to live in the metro cities and not shift back entirely to an area that has modern amenities but has an overall lesser cost component). Basis this, if you get a return of 12%, you are simply protecting the buying power of your money. Ideally you should be aiming for 15%. This is again subject to change depending how much you invest, your asset diversification and how long you invest (the most important being the last). Over a long enough horizon and depending on the frugality of your lifestyle / life choices, your sectoral inflation may be as less as 7-8%. In an ideal scenario like this, your FDs alone protect the erosion of the buying power of your money and barely tracking the nifty/sensex index would put you in a pretty comfortable place.
Also, it would be really nice if LI actually managed to create a sub-thread that would deal with financials of lawyers and how they manage money (inclusive of taxation benefits if any).