Math

I’m not sure what new math is versus old math. I’m not sure what the math standards are for Common Core versus other standards. I have never been a big math person but recently started thinking about the type of math I actually use on a regular basis.

While calculators and computers are wonderful, it’s extremely important to understand the logic behind the mathematics.

As a simple example, when I look at rental properties I go back to the 1% rule that I learned about when I first started with rental properties. The 1% rule is that it’s a good property if the monthly rental rate is equal to or greater then 1% of the purchase price plus renovation costs. So a house that costs $100,000 plus needs $25,000 in renovations would need to bring in $1,250.00 a month rent. That means the rental would pay for itself in 8 years and 4 months (not counting taxes and insurance) If it can generate $2000.00 a month in revenue the price can be returned in just over 5 years. Being able to do this simple math is important. Whether it’s done by hand or by calculator or by computer doesn’t matter, it’s understanding what the math means that makes the difference.

If you are making pocketbooks and know the selling price, cost of the materials, hourly rate of labor, amount of time to produce a single unit and the number of worker hours you can calculate how many pocketbooks can be created in a day, the minimum number needed to break even and the profit with 100% efficiency. Knowing the final number is nice but knowing how each variable effects the outcome is even more important.

Back when I was coaching soccer there would be times when I would have to help line a field. While I never thought I would ever use the Pythagorean theorem it ended up being helpful to make a 90 degree angle in a corner.

Being able to get a final number is nice but if you don’t know how the number is calculated you really don’t know how to apply it properly.

Math…who needs it? We all do!

Have a great day!

Lawrence