The 80% Rule

The 80% Rule

Our society focuses too much on things. Companies must continously sell their products to make a profit. So they build products to fail and look for ways to make this years product seem better and more desirable than the one you have. Sex sells, and to keep it selling they have to keep it new and different.

We need to figure a way out of our throwaway system. We need to build products that last.

We have too much stress in our lives, and a lot of it is because too few people live under the 80% rule.

Most importantly, we need to get out of the habit of spending.

Look to the 80% rule. You live on 80% of your after-tax income.

The first 10% of your after-tax income goes into savings. Savings that is not touched.

The next 10% of your after-tax income goes to charity.

Doing this will diminish stress and reduce spending but by increasing savings you increase investment which offsets the reduction in spending (at least, in a reasonable system it should).

We can now comfortably lose 20% of our income for a short time without having to do without. If we lose a job, or have to take a paycut, life will be easier. We won't lose our house or car, we can maintain our standard of living and more easily survive economic downswings.

We build for the future. We will have a large savings to hold us through longer downturns, to provide a more comfortable retirement, to help when something big (like a car) needs major repair or replacing. Wouldn't if be nice if the next time you buy a car your 'payment' goes into your savings account instead of some lenders pocket.

This will give us peace of mind and freedom from stress.

Malachi 3:10-13

Bring the whole tithe into the storehouse, that there may be food in my house. Test me in this," says the LORD Almighty, "and see if I will not throw open the floodgates of heaven and pour out so much blessing that you will not have room enough for it.

I will prevent pests from devouring your crops, and the vines in your fields will not cast their fruit," says the LORD Almighty.

"Then all the nations will call you blessed, for yours will be a delightful land," says the LORD Almighty.

Not only that, but your savings along with the savings of your friends and family will help drive business and industry providing a stronger economy that is less prone to economic swings.

Deuteronomy 14:22.

Be sure to set aside a tenth of all that your fields produce each year.

Job 8: 7.

Your beginnings will seem humble, so prosperous will your future be.

You will have the immense satisfaction of doing good. Of helping those less fortunate (and of maybe watching taxes go down because there is less need for government welfare and bureaucracy). Not to mention, knowing that if you suffer a really bad setback help will be available for you as well.

Part of the problem we have is the stress because any reduction in income may result in the loss of coveted posessions:

House

Automobile

Phone Service

Cable TV

High Speed Internet

Whatever

If they have followed the 80% rule to begin with the payments on the first two items would be much lower. So if their income fell they don't lose as much.

I once met a husband and wife who were buying a house. Their children were grown up and off on their own, so it was just the two of them. One would think that a small 2 or 3 bedroom house would have easily met their needs, but no, they were building a 5 bedroom monstrosity that fit their income level. Of course, if their income drops, they will likely lose their house and much, maybe most or even all, of their investment.

I did not bother to ask them why they were spending $400,000.00 on twice as much living space as they could possibly utilize.

People all over do this, they spend way too much on cars, way too much on housing, get way too much stress because they now have to maintain their income level, and end up living from paychek to paycheck and wonder why they can never manage to get ahead.

Then they start obsessing over how much income they will have at retirement and this just adds to their stress levels.

Think what would happen if everyone in the U.S. followed the 80% rule:

Churches and other charities would have enough money to really help the needy. We would reduce dependence on Welfare and reduce the control the government has over us.

Saving and investment would go way up. Businesses would have no trouble finding capital to expand, creating more jobs and providing more real GNP.

People would have enough to retire on and Social Security could go back to being a fall back rather than the primary retirment program.

Economic downturns would not be feared.

Mothers and fathers would have more flexibility when it comes time to decide who stays home with the kids.

We would achieve full employment.

The average stress level would fall significantly. Fewer people would die of heart failure. Fewer people would have nervous breakdowns. Fewer people would commit suicide.

The governement could do more with less taxes, giving us more to spend, save, and donate. This would do even more of all of the above.

Goodness gracious, we would all have a good life.

Amen