I was requested to write this up after the recent 'How to be more powerful' failure on this board. Not directly related to TRP, but good for life in general.

The Red Pill has taught you that status is important, so you may be tempted to spend your money on a bunch of stuff I would consider stupid shit. I'm going to go what I feel is a little against the grain here, and suggest otherwise.

Everything that I would like to write would be too long to put in one post, so if enough of you are interested, I'll consider writing more. This is going to be a basics course.

So most of what I'm talking about is based on the Trinity Studies (google it). Here's the tl;dr on it. Smart guys looked at what kind of returns you would get AFTER INFLATION if you invested your money fully diversified in US stocks and bonds over a 30 year period. They did 1900 - 1930, 1901 - 1931, etc. The lowest returns they found was just over 4%, and it was shortly after the Great Depression. The takeaway from this is: in the worst economic conditions the US has seen in the last 110 years, you would have been pretty safe withdrawing 4% of your money per year if you invested it right, and you would never run out of money. Obviously this is very simplified, but it's the assumption we're going to run with for the moment.

If you're withdrawing 4% of your money after inflation, that means you need 25 times your yearly expenses, and you could live entirely off of the interest you're earning. At this point you would be financially independent, and you could quit your job, or you could just work part time only on something you enjoy. Many people I've read about that use this strategy end up making their own business in something they're interested in. The point is, if you make it here, you're in complete control in your life. You're no longer required to get up and work 9-5 every day, or to answer to anyone, because you can leave them at the drop of a hat, and be fine.

Let's do a quick example of how long it would take to get to this point. I'm going to use some rough numbers from a friend I have in real life.

He's 24 years old right now, just paid off his college debt (so let's assume he has 0 net worth), and he's making about 45k/year, which I'm going to multiply by .66 to get 29,700 after taxes. Let's say he needs $1200 a month to live pretty comfortably.

This may seem really low or really high to some of you, but to me it's quite high. I can go over why in other posts.

So, $1200/mo is $14,400/year. 25 * $14,400 = $360,000. Since he's spending $14,400/year, that leaves $15,300 over to be invested. If you invest this in something that gets you 5% returns after inflation (which is really easy to find, and even easier to invest into. More on that another time, again.) this would take my friend about 15.5 years to retire. This is assuming he NEVER gets a raise at his job. So he would be financially independent at the age of 39.5. Pretty cool

Now I'm sure to some of you this sounds amazing, and to some of you unrealistic. I'm not going to argue over it yet, unless there are enough people interested.

Now if this sounds good to you, you're probably thinking "but I don't want to live like a scrub forever, I need high status items."

I personally advocate spending money, even if it delays your independence point on quality items that are meant to last you a long time. For example, I needed a new computer because my old one broke. I laid down about $900 on a 14", 1080p, 4th gen i7, 8 gb ram, Nvidia "Geforce Card I'll never even use the maximum potential of", with an SSD. I won't have to replace this laptop for well over 5 years. (My last one lasted 6 years) This is something that can add to your high-status look, but is still worth the money. Same with clothes, buy clothes that look good, fit you right, and last a long time. As long as they're quality and they last, it's not a bad investment. Same with hobby items. I play guitar, so I bought an electric guitar that I'll never need to replace, only do maintenance on if something like an electrical failure in the wiring for the pickups. These types of things are just worth it, in my opinion.

Now, while I've been talking about using this money to buy your 'freedom,' you could also use it this strategy to save up for big ticket items. Do you feel you NEED a Corvette? Cool, this will get you to one faster.

If you guys want advice on how to save money really easily to make this more realistic, let me know and I can make a post on it. If you have any questions I can try to answer them, but realize most of what I've written so far is a really dumbed-down version of everything, and I don't want to get too technical unless it's in another post.

tl;dr: Live off less than you make, invest the rest, and you can buy your freedom or high-price items more easily. r/financialindependence is ALL about this shit. Check it out if you're really interested and can't wait to learn more.