That's a function of both inflation rate and your expected ROI. Using 3% inflation and 6% ROI you need to reinvest ~51.6% of your income to break even. (1-(ROI-((1/(1-inflation rate))-1)))/ ROI = 1-(.06-((1/(1-.03))-1))/.06 = ~51.6%
Edit: Ok there must be a simpler way to write that...
((1/(1-inflation))-1) / ROI = ((1/(1-.03))-1)/.06 = 51.6%
PS: Just keeping what left over when you subtract the inflation rate from your ROI is close and you don't actually know the inflation rate or your long term ROI most of the time.
((1/(1-inflation))-1) / ROI = ((1/(1-.03))-1)/.06 = 51.6%
PS: Just keeping what left over when you subtract the inflation rate from your ROI is close and you don't actually know the inflation rate or your long term ROI most of the time.