How to calculate your true monthly income (the churn trap)

How to calculate your true monthly income (the churn trap)

New to recurring? Most beginners overcount because they forget people cancel. Let's fix that today.

Churn means the share of customers who quit each month (like friends slowly leaving a group chat).

1. Take your active paying referrals (say 50).
2. Multiply by your monthly commission per person ($6) = $300/mo gross.
3. Estimate monthly churn (5% is common for software).
4. That's about 2-3 people lost each month you must replace just to stay flat.

In plain English: some money leaks out every month, so count net, not just new.

Worked example: 50 people at $6 = $300/mo. At 5% churn you lose ~$15/mo unless you add ~3 fresh signups to refill the bucket.

Today's tiny action: write down your active referral count and multiply by your per-person payout.