Hard to Fire

THE WALKAWAY NUMBER · CHAPTER 3 · WHAT THE HOUSEHOLD ACTUALLY SPENDS

The Burn Rate Audit

Turn three months of transactions into the actual burn rate, core burn rate, and monthly acceleration fund.

Output: A transaction-backed three-tier audit with monthly and annual burn, acceleration, and six compound-growth cases.

Time: About 3 hours, spread across a weekend if preferred

Actual monthly burnUnresolved
Core monthly burnUnresolved
Monthly accelerationUnresolved
Transaction linesEvidence backed
Record statusOpen

Record every transaction line and resolve its core amount.

1. Lock the three-month evidence window

Use actual transactions from every account money leaves. Memory is not a three-month statement.

2. Categorize every transaction

Fixed uses the full three-month average as core. Flexible and discretionary require an explicit core amount from 0 to the average.

Average: UnresolvedCore used: UnresolvedOpen

3. Read the three tiers

Fixed averageUnresolved
Flexible averageUnresolved
Discretionary averageUnresolved
Actual annual burnUnresolved
Core annual burnUnresolved
Annual accelerationUnresolved

4. Compound the acceleration fund

Acceleration = actual-core. The monthly amount is contributed at month end under 3%, 5%, and 7% real assumptions.

3% real · 10 yearsUnresolved
3% real · 15 yearsUnresolved
5% real · 10 yearsUnresolved
5% real · 15 yearsUnresolved
7% real · 10 yearsUnresolved
7% real · 15 yearsUnresolved

No benchmark grades this household. No benchmark grades this household. The useful result is an amount tied to transactions.

Take material debt, insurance, tax, benefit, or investment changes to the qualified professional who owns that decision.

Completion test

Name all three statement months and source accounts, categorize every recorded transaction, resolve the core amount for each line, and run the acceleration fund through every 10-year and 15-year return case.

Monday Move

Open the statements before opening a budgeting app. The app may have opinions. The charges have evidence.

Saved locally in this browser with LocalStorage until cleared.