My name is RAE. I'm going to become financially independent and wealthy.

This is a simple, no nonsense account of my journey.

Saving and investing exhibit interesting behavior.

If I accumulate savings year-over year, they tend to accumulate *linearly*. If I invest my savings and get a small return on my savings year-over-year, they accumulate *exponentially*.

Exponential accumulation or growth is much, much faster than linear growth. It is this exponential growth that will allow me to become financially independent sooner rather than later.

Assuming a rounded down average total income of a census non-elderly family in Canada of $90,000 and a rounded down average household expenditure(consumption) for a census couple family in Canada of $50,000, the table and chart below show what that exponential growth looks like. The two curves start off close, but then the accumulated investments really takes off. It's a snowball effect, where the accumulating return on your savings eventually grows large enough so that it becomes a significant part of the amount being invested each year.

Assuming that someone was diligent enough to save $40,000 each year and invested to get a consistent 7% overall return year-over-year, the difference between the exponential and linear accumulation ($1,754,607.07 - $800,000) would be $954,607.07 in just 20 short years.

**You very quickly realize that your annual savings rate is the only thing that matters**, especially if you're goal is to accumulate 25 times your annual spending.

This table lets me set a date to reach my goal of $1,250,000 in investments. If I stick by this table, I should be financially independent in ~16 years.

This is a lot less than the projected retirement age of never for a millennial like myself.

I assume in the table above that the rate of return on my portfolio stays at a consistent 7% year in, year out. That is of course not the case, as it will go up and down. That can make a big difference. I highlight my reasoning for assuming this **average** rate of return in my Investment Thesis.

I have also assumed so far that I start with $0 to my name, and myself and my partner's combined ability to save $40,000 a year.

Along the same lines, I assume that my partner and I will keep earning a combined net income of $90,000. It will mostly likely go up and down as we advance through our careers, whether it be through wage increases, employment changes, periods of unemployment, etc.

I have presented only a simplified representation of exponential savings/investments/portfolio growth and have only highlighted the factors that have gone into my decision making process, as I feel it captures the essence of my goal of and path to financial freedom.