The 173X Rule -- from Chapter [F]inance, Recipe [F]6, Ingredient [F]6.1


I meet a ton of people who want to be entrepreneurs or their own bosses.  Many creative artists want to make the jump from artist to commercial artist but don't have the funds necessary to spend money on marketing campaigns and to pay for hot leads.

It's always coming down to "I'm broke" -- and it surprises me because many of these folks aren't 16 years old, but often twice that age or even three times.

One of the simplest rules that the yellow pill teaches helps resolve this problem through the lowest reward activity one can do with money: that is, save a little bit every day.

 Save money for years => spend money for months => make money for days. 

The 173X Rule basics

The 173X Rule is basically this: for every $1 you refuse to spend each month going forward, that you save in a free investment account, should be worth around $173 in 10 years.  If you stop spending $10 each month and invest it instead, after 10 years you should have $1730 in that account.  $4 each day that you refuse to spend invested over 10 years should be worth around $21,000 after 10 years.

It's a ridiculous amount of money -- and you don't even need to be good at math or understand stock investing to get there.  You just need to take the low reward break in the path when the question comes up: "Can I afford to buy this inconsequential thing, or does my financial future tell me I can't afford it?"

Those broke 28 year-olds

It aggravates me the most to meet 28 year olds who are too broke to break into their income market they daydream about.  That's 10 years since leaving high school.  Even if they made the error of taking on college debt, there is still no excuse for them not to have $4 invested every day since graduating high school.  $21,000 at the age of 28 is enough to start almost ANY solo business and get your first ads out there.  But instead of having that start-up capital, they're taking on more time-debt and money-debt and crying about it.

The 520X/1220X Rule

It gets worse after the 10 year "I'm broke" mark for the 28 year old.  The 38 year old who would have been saving $4 a day for 20 years would likely have $63,000 saved -- enough to invest in a small 1 bedroom condo in much of the USA.  That's the 520X rule: for every $1 you save each month for 20 years, you should have $520 after.  And the 1220X rule: for every $1 you save each month for 30 years, you should have $1220 after.  $4 a day for 30 years is $147,000 at the age of 48 -- more than enough to pay off a small efficient home in much of the country -- or open a small restaurant, or a commercial arts business, etc.

How likely are these returns?

No one can forecast the future, but over the past 94 years, analyzing the stock market and index funds returns, these are the numbers that are consistent with those who save a little bit every day or week.  Of course you won't see consistent returns every day, or every year, but doing it over a 10 year period is much more likely to bring you big returns than whatever it is you spent $4 on every day for the past 10 years.

Seeing broke guys with bags of fast food in their cars drives me insane -- and makes me want to part ways with them if they can't stop themselves once a day and say "I want $18,000 in 10 years so I won't have to live like this."

Continued in part 2.  Remember: the cult conspiracy cookbook is ALWAYS FREE and nobody should be trying to sell it to you.

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