I have a question on making my assessments for my Lifestyle needs (based off of MJ DeMarco's equations), and the money/business system incomes that will fund these lifestyle needs. His examples were similar in some sense and I was curious how he arrived at those numbers. He said 2k a month for his house, 1k for travel, etc... Here are my quantitative goals just as a basis for how much I want to make, if anyone has any clarity or more accurate corrections for the numbers I would appreciate it.
Lifestyle: TC: 1YR/M: 5YR/M:
Gross Living Cost = $312,400/mo. (Lifestyle cost) + $4,200/mo. (Allowances) = $316,600/mo.
Gross Living Cost = $62,660/mo. (Lifestyle cost) + $4,200/mo. (Allowances) = $66,860/mo.
Net Living Cost = $316,600 / .60 = $527,700/mo. .60 = 60% for potential taxes
Net Living Cost = $66,860 / .60 = $111,500/mo.
Money System Target = ($527,700 x 12) / .05 = $126,648,000 .05 = 5%, the minimum
Money System Target = ($111,500 x 12) / .05 = $26,760,000 expected yield on a money system
Business System Target = ($316,600 x 5) = $1,583,000/mo.
Business System Target = ($66,860 x 5) = $334,300/mo.
First seek a business system that generates $334,300/month in passive income. Of this income, 40% goes to taxes, 40% goes to fund my money system, and 20% pays my lifestyle.
.
Lifestyle: TC: 1YR/M: 5YR/M:
| $150,000 $75,000 $400,000 $140,000 $150,000 $70,000 $120,000 $200,000 | $12,500 $6,250 $33,400 $11,700 $12,500 $5,800 $10,000 $16,700 | $2,500 $1,250 $6,700 $2,400 $2,500 $1,200 $2,000 $3,400 |
| $15,000 $30,000 | $1,250 $2,500 | $250 $500 |
6,000 Sq-ft house | $1.5 million | $125,000 | $25,000 |
Small house in warm area | $750,000 | $62,500 | $12,500 |
Ability to travel 3 months a year | $120,000 | $10,000 | $2,000 |
Body Problems | $20,000 | $1,700 | $340 |
Yearly Health Products | $7,200 | $600 | $120 |
| Lifestyle Cost = | $312,400/Month | $62,660/Month |
Allowances | | $4,200 | |
Gross Living Cost = $312,400/mo. (Lifestyle cost) + $4,200/mo. (Allowances) = $316,600/mo.
Gross Living Cost = $62,660/mo. (Lifestyle cost) + $4,200/mo. (Allowances) = $66,860/mo.
Net Living Cost = $316,600 / .60 = $527,700/mo. .60 = 60% for potential taxes
Net Living Cost = $66,860 / .60 = $111,500/mo.
Money System Target = ($527,700 x 12) / .05 = $126,648,000 .05 = 5%, the minimum
Money System Target = ($111,500 x 12) / .05 = $26,760,000 expected yield on a money system
Business System Target = ($316,600 x 5) = $1,583,000/mo.
Business System Target = ($66,860 x 5) = $334,300/mo.
First seek a business system that generates $334,300/month in passive income. Of this income, 40% goes to taxes, 40% goes to fund my money system, and 20% pays my lifestyle.
.
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