Passive income of $3000 per month – How did I arrive at this number?

Yay! Another blog entry with Excel again! I’m telling you, this obsession with spreadsheets of mine is really hitting through the roof. BF has been complaining about the number of Excel sheets that I have and requested me to consolidated all of them into 1 master sheet.

Oh well. Guess it’s his fault for dating an Engineer. LOL.

Anyway, I previously blogged about my personal financial goals and one of them was to achieve a passive income of $3000 by age 40. You could be on two ends of the spectrum.

One, you are an investor with a very good track record. You look at this goal and you say “Walao, so damn easy to achieve lah. Don’t need Age 40, too long already. I’ve done it since Age 35 or earlier!!! Try to achieve something more challenging please.”

Two, you are very new to investing, probably haven’t started investing any at all, or you’re already near the age of 40 and you yourself aren’t anywhere close. You look at this goal and you say “Wa, is it even possible? Maybe $1000-$1500 lah, unless you have no financial commitment.”

Well, it is interesting because I actually belong to the second group. I’ve only recently started my investment journey last year and as new as I am as an investor, I think defining my goals should be essential to my journey and it will automatically lead me to the direction I that I need to take. If you’re wondering, I only have a portfolio with 2 stocks, one of it being Nikko AM STI ETF. ^_^

Talk about diversification. :p

So back to the title. How did I arrive at this number?

It’s easy! Just do some calculations and you’ll know how much you need to progress each year. Like I always say, the numbers don’t lie.


  1. My starting capital at Age 27 is $30,000.
  2. My annual investment sum is $30,000.
  3. My annual expected yield is 6%.
  4. I reinvest all my returns back into my portfolio.
  5. I stop working by Age 55, and therefore will not have additional money to invest.

Access the spreadsheet here.

I’ve placed a screenshot here for convenient viewing.

retirement portfolio


  1. By Age 55, I will have a portfolio of $2,209,193.95. This is together with my original capital of $870,000. My total returns by the time I reach the end of age of 55 will be $1,471,745.59.
  2. My starting capital is $30,000. I could invest more or less depending on how much I set aside for my initial investment at 27. This will change the result of my calculations and I may achieve my goal at a different age. Download the spreadsheet and try it out for yourself!

Now, my personal thoughts on the feasibility of this.

I wouldn’t say that this is an impossible goal. The math is simple, and to be honest, I think trying to achieve an annual yield of 6% is pretty reasonable. Other than that, my portfolio is purely based on returns. It does not account for growth. Neither does it account for possible losses in the event that I have bad judgement. I guess the difficult part would be to constantly have $30,000 annually for investment. As of now, it isn’t an issue but as I grow older, I would probably need to set aside more emergency funds if I have other financial commitments. Nevertheless, I’ll strive hard for this goal and review it every year to monitor my progress.

What about you? Maybe it’s time that you set a financial goal for yourself too. Share your goals with me if you have any by leaving a comment. I would love to know more! 🙂

Thanks for reading!

Miss Niao xoxo

Author: Miss Niao

Hello! I blog about financial matters and things that average people can do to have a better retirement. I want to inspire people to take control of their money and have a better understanding about it. If you are interested to know more, follow me @! :)

20 thoughts on “Passive income of $3000 per month – How did I arrive at this number?”

  1. Hi Miss Niao

    Happened to see your blog update in It is impressive that you are already financially savvy at your age.

    I have made a similar chart recently with breakdown of total income and expense so as to evaluate my annual invest-able fund, it is surprisingly low at <20k p.a. ! Therefore it is amazing that you can achieve 30k p.a. invest-able fund, considering that you are 4 years old younger than me 🙂

    Keep it up! You should be able to semi-retire at age of 40 as 3k monthly passive income should be sufficient to cover your family expenses if you live frugally.


    1. Hello Chun Kiat!
      Thank you very much for your comment ^_^ and thank you for dropping by. I appreciate it.
      Yes, charts don’t lie and it is important that we review our cash flow every year so that we can grow more cash using it. The more you know about your finances, the more steps you can take. 🙂
      This is still my first year trying to save 30K. Have to give up many cups of bubble tea T_T.

      Come by everyday for a new post if convenient! 🙂

      Miss Niao xoxo


  2. Good spreadsheet model there.

    I did the same too when I first started my blog but back then because I had to work backwards by wanting to achieve financial independence at the age of 35, the rest of the input becomes a mathematical function.

    The good thing about doing backward is you’d eventually know that the input becomes too big to achieve, for example I had to have $60k capital injection every year with a 6% yield (similar like yours). Knowing that I am not going to get the $60K capital, I exchanged it with a market capital gain return to offset it. Works out evenly at the end of the day. I think doing that backward gives a harder push to ourselves than going actively with the input to meet the end outcome.

    Liked by 1 person

    1. Hello Brian! I read your blog once in a while to check on your portfolio. It seems like your progress for 2017 has been a great one. I have a lot to learn from you ^_^

      I did a similar calculation for a previous article on how to retire by Age 40. Calculating backwards can definitely show us the final goal that we need to achieve even clearer, and how we can use our existing resources to reach there.

      Let’s work hard together! ^_^

      Miss Niao xoxo


  3. Hi – Came through this blog and cool and am also trying to generate some income other than my day work and as of now all equities.. 3k seems far to me considering i started very late :(.
    Will keep reading the post for some ideas and improvements.
    Thanks again

    Liked by 1 person

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