# Who decides how much money prints? – Watch Videos And Earn Money In Nigeria

It depends on two things:

1) What is your net worth

2) What’s your tax rate

Let’s start at the bottom and work up.

I won’t pretend to know the answer to either of these questions, but you will find my own answer to it quite easy to figure out. The idea is a bit convoluted, so bear with me below.

What is your net worth? Well, since I want to know about your net worth, we have to work backward until we start the calculation.

First of all, we need to find the total amount of money you’re carrying (or not carrying).

As you can see in Figure 1, if we assume your total income is \$100, then your annual interest on your outstanding debt amounts to \$400 for a \$100,000 balance. When you use 10% as your deposit rate, this means that your interest payments are \$30 for the whole year. Thus, you are carrying approximately \$600 of debt.

Now, what are your monthly costs of living?

First of all, since \$400 is a lot of money as you can see in this image, it’s no accident that my monthly costs of living are \$600. But, for simplicity, we want to look at them as a group. What is the total monthly cost of living of your two households?

You guessed it – \$600 x 2 = \$1,000!

Now, let’s figure the amount of money the household will use to pay the interest on it’s debt, assuming we assume that your annual interest rate remains the same (10%).

The sum, \$2,000, is equal to \$2,800. Therefore, your net worth will remain constant, since each household pays equal interest on the outstanding debt.

Your tax rate remains the same!

So what is your tax rate on your \$1,000 net worth?

You guessed it, \$400 x 6.2% = \$7,200!

If you are in the 30% bracket, you will get a tax increase equal to two-thirds of the full \$7,200. If you are in the 39.6% tax bracket, you will get only one-seventh of the increased amount. But at your income level, this makes little difference! This means it will have minimal impact on your life.

Note that this calculation assumes you own

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