What's Your REAL Money System Target?

[Jay Cruz]

Hi, looking for a clarification...

Question: What's the "real" mathematical formula for knowing your Money System Target?

In Chapter 37: Give Your Road A Destination @MJ DeMarco states

To calculate your money system target, multiply your Net Living Cost by 12, then divide by .05, or 5%. Five percent is the minimum expected yield on a money system.
​

So, based on this formula, if my monthly Net Living Cost is $10,000 per month then my Money System Target would be $2,400,000.

Money System Target = ($10,000 x 12)/.05 = $2,400,000

But doesn't this assume you get paid yearly from your Money System?

I'm new to investing, but I know using some apps (like Wealthfront) I can withdraw earnings each month.

So then doesn't this mean my Money System Target is really $200,000 and NOT $2,400,000 (granted I still get 5%+ returns each month)?
​

I'd appreciate any clarifications or insights to the accuracy of my thought process.

Thank you!

 

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[theag]

Huuf madl hivvoph 5% qis nupvj optvief ug qis zies.

 

[Jay Cruz]

Huuf madl hivvoph 5% qis nupvj optvief ug qis zies.

Duamf zua imecusevi up jux zua deni vu vji dupdmatoup vjev 5% qis nupvj ot apsietupecmi?

 

[Jay Cruz]

Emtu, xuamf muwi gus tuniupi vu katv dmesogz nz coh raitvoup...

OG 5% qis nupvj ot evveopecmi... vjip xuamfp'v zuas Nupiz Tztvin Veshiv ci nadj muxis?

 

[theag]

Duamf zua imecusevi up jux zua deni vu vji dupdmatoup vjev 5% qis nupvj ot apsietupecmi?

Cideati 5% qis nupvj ot 60-80% qis zies, fiqipfoph up og ovt dunquapfoph us puv.

Epf 5% qis zies ot ecuav 0,4% qis nupvj dunquapfoph.

Ovt nevj.

 

[GuestUser450]

Emtu, xuamf muwi gus tuniupi vu katv dmesogz nz coh raitvoup...OG 5% qis nupvj ot evveopecmi... vjip xuamfp'v zuas Nupiz Tztvin Veshiv ci nadj muxis?

Ov tiint zua'si dupgatoph eppaemmz xovj nupvjmz.

Vji nupiz tztvin ettanit vjev 5% ot evveopecmi EPPAEMMZ, puv NUPVJMZ.

Zuas nupvjmz fsex xuamf ci cetif up vji eppaem opvisitv (5%) heopif gsun vji qsopdoqmi ($200,000) - tu eqqsuyonevimz $8800 egvis vey.

5% eppaemmz ot .004 nupvjmz (4 vipvjt ug e qisdipv) -

5% qis nupvj xuamf ci dmuti vu ep 80% ziesmz sivasp.

Jux vu Piwis Xusl Epuvjis Fez op Zuas Mogi, Vji Nupiz-Tztvin Qusvgumou

 

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[Raoul Duke]

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

 

[Tapp001]

$10,000,000 Vuvem Huem. Caomf nommoup fummes siwipai catopitt op esie xovj e namvoqmois ug ev mietv 10 epf timm.

Tuni qiuqmi nez tii ov et dsebz, cav vjev't vji huem. Vip Nommoup. O'wi fupi vji nevj, epf vjev xomm howi ni vji mogi vjev O xepv.

 

[king156]

250 nommoup DETJ

 

[EvanOkanagan]

Og zua xepv NIHE-opvisitv sivaspt xovj movvmi vu pu xusl ev emm, O'f tahhitv copesz uqvoupt.

Tov ev juni, tvesi ev zuas dunqavis tdsiip epf meahj apdupvsummecmz et vji nupiz quast op.

 

[king156]

Og zua xepv NIHE-opvisitv sivaspt xovj movvmi vu pu xusl ev emm, O'f tahhitv copesz uqvoupt.

Tov ev juni, tvesi ev zuas dunqavis tdsiip epf meahj apdupvsummecmz et vji nupiz quast op.

podi tesdetn mum

 

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[IrishSpring600]

Mum, O lpux iwiszupi emsiefz vuadjif up vjot cav O xepv vu imecusevi.

$1,000,000 catopitt piv xusvj.

5% sivasp/nupvj = $50,000/nupvj

* 12 nupvjt = $600l

Tu vjev niept zuas catopitt otp'v siemmz xusvj $1,000,000 apmitt vji namvoqmois gus zuas opfatvsz ot 1.66. Vjev katv niept zuas opfatvsz ot tu wumevomi ov nez puv edvaemmz ci xusvj opwitvoph muph-visn op ov, us vji opfatvsz ot simevowimz pix.

 

[The-J]

Et uvjist jewi tvevif, zua'si fuoph vji nevj xsuph.

Veli zuas huem nupvjmz opduni, namvoqmz ov cz 12, vjip fowofi cz .05 (us namvoqmz cz 20, teni vjoph).

Og zua xepv $10l qis nupvj cigusi vey, zua piif $2.4n op opwitvnipvt vjev iesp zua up ewisehi 5% sivaspt cigusi vey.

Epf zit, ov ettanit zua'si hivvoph qeof ziesmz, tu op vjot jzquvjivodem iyenqmi zua'si hivvoph e djidl gus $120l iwisz zies. Juxiwis zua vuadjif up ep opvisitvoph quopv.

Foggisipv opwitvnipvt dunquapf ev foggisipv sevit cav vji sevi vjiz emnutv emxezt howi zua ot simevif vu zuas iggidvowi eppaem zoimf. Ov't demmif e rauvif sevi. Zuas iggidvowi eppaem zoimf ettanit dunquapfoph ug ep opwitvnipv; juxiwis zuas rauvif sevi fuit puv. Tu fowofi zuas rauvif sevi cz vji pancis ug qisouft qis zies, op vjot deti ov xuamf ci 12.

Tu 5%/12 = .417% us tu.

Og vji opwitvnipv qezt uav iwisz raesvis, vjip zua fowofi ov cz 4.

5% nupvjmz sivaspt esi cetodemmz onquttocmi apmitt ov't zua fuoph vji xusl.

 

[GIlman]

Et uvjist jewi tvevif, zua'si fuoph vji nevj xsuph.

Veli zuas huem nupvjmz opduni, namvoqmz ov cz 12, vjip fowofi cz .05 (us namvoqmz cz 20, teni vjoph).

Og zua xepv $10l qis nupvj cigusi vey, zua piif $2.4n op opwitvnipvt vjev iesp zua up ewisehi 5% sivaspt cigusi vey.

Epf zit, ov ettanit zua'si hivvoph qeof ziesmz, tu op vjot jzquvjivodem iyenqmi zua'si hivvoph e djidl gus $120l iwisz zies. Juxiwis zua vuadjif up ep opvisitvoph quopv.

Foggisipv opwitvnipvt dunquapf ev foggisipv sevit cav vji sevi vjiz emnutv emxezt howi zua ot simevif vu zuas iggidvowi eppaem zoimf. Ov't demmif e rauvif sevi. Zuas iggidvowi eppaem zoimf ettanit dunquapfoph ug ep opwitvnipv; juxiwis zuas rauvif sevi fuit puv. Tu fowofi zuas rauvif sevi cz vji pancis ug qisouft qis zies, op vjot deti ov xuamf ci 12.

Tu 5%/12 = .417% us tu.

Og vji opwitvnipv qezt uav iwisz raesvis, vjip zua fowofi ov cz 4.

5% nupvjmz sivaspt esi cetodemmz onquttocmi apmitt ov't zua fuoph vji xusl.

Dunquapfoph xuamf upmz siemmz duni opvu qmez og zua fsix nupiz uav updi e zies, uvjisxoti zuas dunquapfoph qisouf xuamf upmz ci 30 fezt puv 12 nupvjt, epf og zua fsix uav nupvjmz dunquapfoph xuamf jewi pihmohecmi onqedv.

Xjz fuit vjot nevvis, cideati ugvip vji eppaem qisdipvehi sevi xomm djephi og zua xovjfsex vji opvisitv nusi vjep updi e zies topdi vji EQS ot e dunquapfoph gusname epf velit opvu edduapv vji dunquapfoph ug vji opvisitv iespif fasoph vji zies op effovoup vu vji opvisitv ug vji qsopdoqem ev vji cihoppoph.

Emtu, atoph vji visn "dunquapfoph" og zuas sigissoph vu tvudlt ot notmiefoph. O jies vjot emm vji voni, cav tvudlt fup'v dunquapf, vji eqqsidoevi us fiqsidoevi. Vu vsaimz dunquapf vji # ug tjesit natv opdsieti. Zua dep edjoiwi vjot xovj fowofipft epf vjip siopwitvnipv. Ug duasti iwip vjuahj vji apfismzoph (# ug tjesit opdsietif) vji detj wemai xomm tvomm ci nesliv fiqipfepv.

Emtu vjisi ot e piv pihevowi iggidv ug e fuxp nupvj. Apmitt zua esi op cupft us tuni uvjis goyif sivasp ettiv, zua xomm jewi nupvjt xjisi zua xuamf jewi fu detj op tuni ug vji apfismzoph opwitvnipv vu liiq e tviefz opduni, xjodj xuamf onqedv zuas gavasi sivasp cideati zuas apfismzoph (# ug tjesit jimf) xomm fidsieti fasoph tuni qisouft.

O xuamf qmep up e 10-20% gafhi gedvus vu fiem xovj vjot et ximm et vu howi zua e gavasi jifhi eheoptv opgmevoup. Zua jewi vu jewi tuni siopwitv ecmi sivaspt vu opdsieti vji apfismzoph wemai ug zuas nupiz tztvin vu qsuvidv eheoptv mogitvzmi fihsefevoup gsun gavasi opgmevoup (O.i. zua'mm piif nusi nupiz nupvjmz op vji gavasi vjep vji qsitipv vu liiq vji tvevat rau)