58Twelve

In the current economic and social climate we all face the stark reality that nothing is secure: whether it’s money in the bank, a business you have built or a job you have held down for years, to believe it is safe is to clutch at straws.

In order to contribute to society, we are taught that we must:

1. Get a good education.
2. Get a good J.O.B. (Just Over Broke)

There’s nothing wrong with getting a good education, but when you get a job you are trading your time for money and the correlation between time and money is not weighted fairly; and so you can work for 40 years in anticipation of a great retirement and still die broke – no matter what your salary. Take a look at this…

Let’s say there are 40 hours a week and you are paid for 50 weeks of the year and you have a working life-span of 40 years (just to keep numbers nice and easy). Let’s also say that you’ve landed a nice job and you get £20 an hour (pick any rate you want – the end result will be the same)

So in 2000 hours each year at £20 per hour you earn £40,000 a year. Sounds great when you think that in your lifetime you will earn £1,600,000!

Of that £1.6m you will lose about 40% in taxes and national insurance. So straight away you have lost £640,000 to the government! So now you have £960,000 to fund our lifetime.

You need somewhere to live, and in the UK you spend in the region of 25%, or on these numbers £400,000 on housing, whether as a mortgage or rent, leaving you with £560,000.

But you have to eat, clothe yourself and, if you have them, your kids, and you need heat, light etc. That will take on average another 25%, or £400,000 from the pot. So after the basic needs have been met we find ourselves with £160,000 left.

Let’s assume you decide to eat out to celebrate a special anniversary or birthday from time-to-time, maybe take a vacation or go to the movies. What about a pet? What about the odd Christmas present or birthday gift? Well if you apportion £160,000 across the working life of 40 years then that gives you about £325 a month to fund those things. That’s before you think about major purchases like cars, college for your kids or anything along those lines.

What about retirement? What’s going to fund that?

I’m an accountant by profession so I know all too well how numbers can be used to paint any picture you like, but this is a picture that from whatever angle you look at it, it tells the same story: most of us will die broke.

But there is another way. A way that requires a change in thinking and a can-do attitude. A way that needs you to want to live rather than exist. This is the opportunity that 58Twelve wants to share with you and help you build, to unleash your potential and help create a generation living the life it is made for, not the existence it has been lured into.