The Freedom Number
- Difficulty
- Starter
- Time to result
- ~days to results
- Steps
- 6
- Confidence
- —
The freedom number is the monthly income at which you could walk away from your job. Kagan's claim is that most people never calculate it, so they default to an abstract and paralysing goal — 'become a millionaire' — instead of a concrete and reachable one. Once you compute it, the target usually turns out to be far smaller than the fantasy: his own was $3,000 a month. That reframe does two things. It makes the first business feel achievable, because you only need enough customers to cover rent and expenses rather than enough to get rich. And it becomes the anchor in every subsequent decision — which business to pick, how many customers you need, and, in a sales conversation, what your offer is actually worth to the buyer.
Origin
Extracted from Deep Dive with Ali Abdaal
How to run it
- 1
Total your real monthly expenses
Rent, food, transport, the basics. Abdaal's version of the calculation was that two or three thousand a month covering expenses and rent would have been enough to leave a job he disliked.
Watch out Use current expenses, not the lifestyle you imagine having.
- 2
Write down the single number
One figure per month that buys you the option to quit. Kagan's was $3,000; Abdaal's was around 10K a month to take a break and 100K to quit outright given his risk aversion.
Pro tip Have separate numbers for 'take a break' and 'quit permanently' if your risk tolerance is low.
- 3
Notice how much smaller it is than you assumed
The point of writing it down is the shock. Most people discover freedom costs a fraction of what 'being rich' implies, which is what makes starting feel possible.
- 4
Pick something you actually enjoy that can reach it
Kagan is emphatic that the vehicle should be something you like doing — for him, promoting software deals. Baking cookies, lawn care, invoicing software all qualify if you enjoy the work.
Pro tip The enjoyment is what keeps you in the game long enough to hit the number.
Watch out Choosing purely on margin is how people quit at month three.
- 5
Work backwards to customers
Divide the number by your price to get the customer count you need. This converts a vague ambition into a countable, checkable target you can act on today.
- 6
Reuse it in sales conversations
Kagan asks prospects for their freedom number precisely because it tells him what solving their problem is worth, which sets both the offer and the price.
In the wild
Kagan's freedom number was $3,000 a month. He had already earned $100,000 at Mint before going back down to zero to start his own company, then climbed 40k, 75k, 120k, 300k. Because he knew the number he needed to be free, the drop to zero was survivable rather than terrifying, and he could spend the intervening years doing the work he actually wanted — promoting software deals — rather than chasing a salary. Six years into AppSumo he started paying himself half a million, and later seven figures.
→ A $3,000 target made an income drop to zero a calculated move rather than a gamble.
Jennifer, a schoolteacher in Dallas who read Million Dollar Weekend, did not want to become a millionaire. She wanted to make a few extra dollars a month for her family. Kagan uses her as the proof that the freedom number is not a rich-person concept: it can be grocery money, or a hundred dollars so you can have a nice meal once a month. The number defines the size of the business you need, and for many people that business is very small.
→ A modest, explicitly stated number turned a teacher into an entrepreneur with creative control.
Common mistakes
Aiming at 'millionaire' instead of a number
Kagan's diagnosis is that people fixate on the million and never make the first dollar. The million is downstream of a dollar; the freedom number is what makes the first dollar worth chasing.
Setting it from an imagined lifestyle
Inflating the number with a future house, car and holidays turns a reachable target into another excuse not to start.
From the transcript
“so one way to get going is your freedom number your freedom number is what you said”
“once you have your Freedom number which yours was $10,000 mine was $3,000 and everyone should figure out what's your freedom number”
“to become a millionaire you have to start with making1 and Everyone by the way can right now on their phone message someone to get…”
From the episode
How To Start Your First Business in 48 Hours - Noah Kagan
Noah Kagan