Word of the day | Critical Mass

Word of the day - Critical Mass

Critical mass in investing, refers to the point where your investment portfolio generates enough passive income to cover your living expenses. This passive income could come from various sources like dividends, interest from bonds, or rental income from properties.

Reaching this critical mass allows you to live off the returns from your investments without needing a traditional job. It's essentially achieving financial independence.

There's no one-size-fits-all answer for how much you need to reach critical mass. It depends on several factors:

  • Your desired lifestyle and situation

  • Location

  • Investment returns

To remember…

  • Reaching critical mass takes time and consistent investment.

  • Investment markets fluctuate, so passive income may not always be perfectly stable.

  • It's wise to educate yourself to understand your specific circumstances, risk tolerance and options.

https://www.dbm.academy/faq for more blockchain vocabulary.