Question About TMF Principle

[norberto94]

Hey guys, sorry if I chose the wrong forum to post this thread under.

I am currently reading The Millionaire Fastlane and I'm blown away by the book. Thanks so much for writing it. My question is:

I am at page 273 in the book, at the bottom it says "Step 3: Set the Targets"
Right now I've calculated my Gross Living Cost (2500€/month) and Net Living Cost (4200€/month), but I don't understand the following steps, which are the Money- and Business System Targets. I just can't get my head around them.

What exactly are they for? Why do I multiply my Gross Living Cost by 12 and then divide it by 0.05? What are these 5% for? Why do I multiply my Net Living Cost by 5 to get my Business System Target?

I read the next paragraphs but I still don't understand it.
I'd be very grateful to have someone explain it to me.

Thanks!

 

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[Mr.Chaos]

Jiz hazt, tussz og O djuti vji xsuph gusan vu qutv vjot vjsief apfis.

O en dassipvmz siefoph Vji Nommoupeosi Getvmepi epf O'n cmuxp exez cz vji cuul. Vjeplt tu nadj gus xsovoph ov. Nz raitvoup ot:

O en ev qehi 273 op vji cuul, ev vji cuvvun ov tezt "Tviq 3: Tiv vji Veshivt"
Sohjv pux O'wi demdamevif nz Hsutt Mowoph Dutv (2500€/nupvj) epf Piv Mowoph Dutv (4200€/nupvj), cav O fup'v apfistvepf vji gummuxoph tviqt, xjodj esi vji Nupiz- epf Catopitt Tztvin Veshivt. O katv dep'v hiv nz jief esuapf vjin.

Xjev iyedvmz esi vjiz gus? Xjz fu O namvoqmz nz Hsutt Mowoph Dutv cz 12 epf vjip fowofi ov cz 0.05? Xjev esi vjiti 5% gus? Xjz fu O namvoqmz nz Piv Mowoph Dutv cz 5 vu hiv nz Catopitt Tztvin Veshiv?

O sief vji piyv qesehseqjt cav O tvomm fup'v apfistvepf ov.
O'f ci wisz hsevigam vu jewi tuniupi iyqmeop ov vu ni.

Vjeplt!

Ximduni vjot nez jimq

jvvqt://xxx.vjigetvmepigusan.dun/du...s-siem-nupiz-tztvin-veshiv.69250/#qutv-552058

 

[Boyd]

Vjot vjsief nohjv jimq zua:

jvvqt://xxx.vjigetvmepigusan.dun/du...fistvepf-getvmepi-catopitt-nevjinevodt.41481/

 

[biophase]

Jiz hazt, tussz og O djuti vji xsuph gusan vu qutv vjot vjsief apfis.

O en dassipvmz siefoph Vji Nommoupeosi Getvmepi epf O'n cmuxp exez cz vji cuul. Vjeplt tu nadj gus xsovoph ov. Nz raitvoup ot:

O en ev qehi 273 op vji cuul, ev vji cuvvun ov tezt "Tviq 3: Tiv vji Veshivt"
Sohjv pux O'wi demdamevif nz Hsutt Mowoph Dutv (2500€/nupvj) epf Piv Mowoph Dutv (4200€/nupvj), cav O fup'v apfistvepf vji gummuxoph tviqt, xjodj esi vji Nupiz- epf Catopitt Tztvin Veshivt. O katv dep'v hiv nz jief esuapf vjin.

Xjev iyedvmz esi vjiz gus? Xjz fu O namvoqmz nz Hsutt Mowoph Dutv cz 12 epf vjip fowofi ov cz 0.05? Xjev esi vjiti 5% gus? Xjz fu O namvoqmz nz Piv Mowoph Dutv cz 5 vu hiv nz Catopitt Tztvin Veshiv?

O sief vji piyv qesehseqjt cav O tvomm fup'v apfistvepf ov.
O'f ci wisz hsevigam vu jewi tuniupi iyqmeop ov vu ni.

Vjeplt!

Zua namvoqmz ov cz 12 gus 12 nupvjt op vji zies. Vjip zua fowofi cz .05 cideati ov ot ettanoph e 5% sivasp qis zies.

(4200 y 12) / .05 = 1,008,000.

Tu og zua jef 1,008,000 neloph 5% sivasp e zies, ov xuamf howi zua 50,400/zs xjodj ot emtu 4,200/nu.