Say the year is 2019, you have accumulated 2M in investible assets and retired at a ripe old age of 40.

Let's further say you are a somewhat conservative but competent investor, returning an average of 6% on your capital, i.e., 120k a year, or 10k a month.

In 40 years time, at a 2% inflation rate, 10k a month would be more or less be equivalent to having around 5k a month in today's value.

As you can see, inflation is a real issue that wipes out the true value of your passive income, and with that, the goods and services you could reasonably purchase with your income.

In order to ensure that you can enjoy substantially the same purchasing power in 40 years time (at age 80), you will need a mechanism to grow your passive income to outpace, if not match, the inflation rate.

In 40 years, @2% inflation rate, the future