Build Your Money Mass Balance – Step By Step

The Money Mass Balance is a powerful tool for keeping you focused on your retirement goals. Building yours is simple, so let’s walk through it step by step.


  1. Draw a box to represent your Nest Egg. The goal is for the final size of your Nest Egg to be just big enough to sustain your quality of life indefinitely without getting any bigger or smaller over time. This occurs roughly when you can live on 4% of it so it can keep up with inflation.img_0175
  2. Draw a line showing your Income going into your Nest Egg. Your total Income is made up of active income, meaning pay from salaried or hourly work, or commissions. Maybe it’s a predictable monthly amount. Maybe it changes month to month. It might temporarily be $0. The Income is an important piece of the Money Mass Balance, but it’s not the only knob under your control.img_0176
  3. Next, draw a line showing your total Spending coming out of your Nest Egg. Use your current Spending for now. This will give you a starting point for trimming the fat out of your Spending to build that Nest Egg faster. Make sure this number reflects reality – it should include insurance premiums, car registrations, gas, utilities, housing, groceries, repairs, gifts, hobbies, restaurants, entertainment, clothes, shopping.img_0177
  4. Your money needs to make money! By putting your money to work, or investing, you are actually lending it – whether to a business, to the stock market, to real estate – and in return you are earning dividends, interest or rent. Draw a Recycle showing Return on Investments. In this example I use 7% of Current Nest Egg.img_0179That’s all there is to it. If you create your Money Mass Balance using monthly numbers for income and spending, it will help you circle back to it each month and keep yourself on track. Soon we’ll set up a tool to automatically generate your MMB. In the meantime, here’s a blank MMB you can fill out with your numbers.img_0181