How much profit is “enough?”

“Profit” is not a four-letter word.

“Loss” is.

Having said that, the question is one I hear a lot and is not easy to answer.  I could glibly toss out a number like 16% or 23%, but so what?  Percentages are not what you put into your bank account—dollars are.

So I always advise people who ask me this question to take some time when they can sit for two or three hours (minimum) undisturbed, in a peaceful setting, with no phones or interruptions—say, a beach at sunset (with a favorite beverage in hand), or in a mountain meadow, or a forest glade, or on the back of a horse—whatever it is that brings you peace and joy and lets you relax.  If you have a significant other in your life, they should be there too.  Then ask yourself the following questions:

• What sort of house do I want to live in while I am here?
• What sort of food do I want to eat?
• What sort of vehicle(s) do I want to drive?
• What sort of clothes do I want to wear?
• What sort of medical care do I want?
• What sort of education do I want for my offspring (if you have offspring)?
• What sort of retirement do I want?
• What sort of legacy do I want to leave to my offspring?
• Where would I live if money were not an issue?
• What kind of travels do I want to do?
• What kind of hobbies and recreation do I want to pursue?
• What could I do to give back to this country for all it has given to me?

And to these you could probably add dozens more along the same lines.

Then take a piece of paper and figure out how much it will take, in annual dollars, to do all that is on your list.  THAT’S the answer to your question.

As an example, suppose you determine that to do all that is on your list will take $220,000 a year.  That’s how much profit you will need to be happy.

The hard part is building a business that churns out that sort of profit.  If you are small (sales under a million dollars), it will be well-nigh impossible. If you are big, it will be easier.  But it won’t be automatic.

Rest assured of this: you only go through this world one time.  If you are lucky enough to be lucid at the end of your life, that would be a lousy time to say to yourself, “Dang, I wish I had done it differently!”  Make all the money you need and spend all you can, but plan for it.  If you just “let it happen,” it probably won’t!

Set a dollar goal and go for it.  Don’t just build a job for yourself—build a dream factory!