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Tony Wright, the CEO of Rescue Time (very cool product, by the way), ponders how much money he would need to make in the sale of his company in order to retire as a young man. He imagines a company with three founders and some outside capital that sells itself for $20 million. Which sounds great, but the results are kind of depressing:

Congrats! Light up the cigars and start hunting for beach houses--you’ve now joined the new rich! Except you really haven’t. You see, you (like a lot of folks) aren’t really thinking what it means to retire at 30.

Turns out that if these 30 year old multi-millionaires want to live off of $200,000 a year, they'll only make it to age 50. And then they'll have to start working again. Blame inflation. The moral of the story, says Wright, is that you probably won't be able to retire for good if you sell your company, and that, as such, you should love what you do. Or at least think ahead:

If you are going to be a mercenary, make sure to optimize not just for “f@#$ you money” but “f@#$ you influence”-- make sure that as you sell your $20m company that you are well positioned to build another company, have a fat executive job, some great advisory roles, paid speaking engagements, and the like. Because you’re still going to want income.

(Put the children to bed and steel yourself: The above link contains expletives. And no, $200,000 a year is not a middle class income. You're rich. Sorry.)

Last updated: Aug 23, 2010




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