How To Improve Human Capital And Accelerate Financial Freedom

Human capital is the present value of all future wages. We go to work every day and are paid wages. The sum of those wages is our Human Capital.

Over a lifetime, our total Human Capital would range anywhere from $5M to $50M. When we start young, we have only Human Capital on our balance sheet – no houses, investments, savings or fancy cars.

Example of a college graduate leveraging Human Capital

Savings are estimated at a conservative 30% although one could ratchet this up and avoid lifestyle creep to accelerate your Financial Freedom Countdown.

Our Human Capital is larger because of Our enthusiasm for contributing meaningfully to society.

Age 25 to 35

Our investments keep growing as we earn more, save more and invest wisely. Our Human Capital also keeps growing as we progress in our careers, acquire new skills and build networks which would propel us even further in terms of our day jobs and side hustles.

Age 35 to 40 After 10 years of working you realize that your nest egg has grown much larger than you had anticipated thanks to the magic of compounding.

All those seeds you planted to grow your career will soon pay dividends. You can ease your foot off the gas pedal and cruise along enjoying the scenery.

Age 40 onwards

Even after letting your Human Capital decline; the start you had in terms of managing your career in the initial decade, will help you reach your freedom number in less than 1-2 years.

Please note that the salary, income and age ranges are only provided as an example for you to follow along and understand the math of how all this works out.

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