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Question on the Lifestyle Equations

Anything related to matters of the mind

MJ DeMarco

I followed the science; all I found was money.
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and the money/business system incomes that will fund these lifestyle needs

Question...

What are your current life circumstances that have compelled you to make this analysis?

Do you have a business right now that generates $1,000/mo, let alone $1,500,000?

Because right now the community's reaction to your equations will probably be a lot of fairy tale, and not a lot of reality.

Not saying it isn't possible -- if any business framework can make it more probable is CENTS -- but creating a business that generates $1.5M/a month in profit is going to require an above average product with above average marketing and above average execution -- and a healthy payroll.
 
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Jcapuano

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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:


  • Corvette ZR1
  • 1969 Vette
  • Lambo Aventador LP 700-4
  • Ferrari California
  • Maserati GranTurismo
  • Audi S5
  • Audi R8 FSI Quattro
  • Corvette C7

$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

  • Suzuki GSXR 1000
  • Ducati
$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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Jcapuano

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Also the formatting got a bit messed up, the 2nd column is the total cost, the 3rd is the cost per month paying them off in 1 year, and the 4th column is payments over a 5 year period. (Also, based on the general prices for a 6,000 sq. foot home it seems his cost was based on a 5 year plan, but another example for say travel was based off a monthly cost for a year.
 

Vanyka

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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:


  • Corvette ZR1
  • 1969 Vette
  • Lambo Aventador LP 700-4
  • Ferrari California
  • Maserati GranTurismo
  • Audi S5
  • Audi R8 FSI Quattro
  • Corvette C7
$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

  • Suzuki GSXR 1000
  • Ducati
$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.
.
Thanks so much for sharing these figures, I've been trying to find this formula everywhere :)
 

G-Man

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Have you put together an analysis this in depth and well thought out for anything that could generate a sale, get a customer, or develop a product?
 

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