This is it. This is the first episode of PTPTV. Let’s dive in.
If I asked you, “How is your financial life going?” (terrible opener, for the record), you’ll likely base your answer on your mood or stress level. Or maybe you’re the type that would base your answer on your income, or maybe you’d go the route of your debt level or your savings account balance. Point is, there are tons of ways you measure your finances. The problem is, none of them give an accurate picture of your financial life. This is where Power Percentage® comes into play.
Power Percentage® is a calculation I’ve been working on for a while now. This is beyond net worth because it gives you credit for anything you are doing that moves your financial life forward. This is the key. I don’t care if you have debt if you are actively paying it off. Power Percentage® takes your hard work into account. Here’s how you do it:
Gross monthly income:
Contribution to company sponsored retirement plan per month:
Company matched retirement plan per month:
Other monthly investments:
Savings per month:
Portion of mortgage payment which pays down principal per month:
Student loan repayment per month:
Medical debts per month:
Personal debts per month:
Credit card debts per month:
TOTAL:
To calculate your Power Percentage divide this total by your gross monthly income. Your result will be in decimal form, move the decimal two places to the left to get Your Power Percentage. Use the key below to see where you are.
KEY:
10% and below = not good
11% – 20% = Okay
21 – 34% = Good
35%+ = Great!
That’s it. That’s the number you need to know. What’s your number? Tell me on Twitter @petetheplanner with #PTPTV.
Now for the fun part. In this episode, I brought in Mark LaFay, an amazing sommelier and friend of the show. In this segment, Mark set up an inexpensive wine tasting for me. If you’re like me and love wine but rely on a budget to keep yourself in check, put Mark’s recommended picks on your grocery list today. Do it.
2. Bodegas Ateca Honoro Vera Garnacha 2015
3. Wines of Substance Cabernet Sauvignon 2014
Until next time,
Pete
Peter Dunn a.k.a. Pete the Planner® is an award-winning financial mind and a former comedian. He’s a USA TODAY columnist, author of ten books, and is the host of the popular radio show and podcast, The Pete the Planner Show. Pete is considered one of the foremost experts on financial wellness in the world, but he’s just as likely to talk your ear off about bass fishing.
Two things, if you need a show about the life of an Internal Auditor, let me know. Also, break the bank and drink some Sequoia Grove Cab.
I’m anxious to see my Power Percentage. I am unclear as to what I should fill-in for the last 3 items in the . Is that the average debt in each of the categories or the payment to the debt? I have about $3000 in credit card debt each month and then I pay it off 100%. I have about $20K in loan that I pay $300/mo towards (0% card) and I have a $140/mo payment for a concierge doctor service. What values should I use for those? Love your show on WIBC Indianapolis.