Jay’s family would have been used to a particular lifestyle, given his income and position in society. As a household moves up the income ladder, what would have been discretionary spending earlier, become essential expenses. This may include salaries of support staff, entertainment and socialising costs, travel and other such expenses. Jay has to make a realistic estimate of these and deploy an adequate corpus so as to insulate these from the volatilities of the enterprise he begins. The corpus should be able to cover three years’ expenses, adjusted for inflation.
