X-Curve

The X-curve is a graph showing two major lines in our lives: the wealth or savings line and our responsibility line. It is shown that ideally from our younger to older years, our wealth and savings line should go up while our responsibility line simultaneously should go down. The X-curve is divided into 4 quadrants.

1. QI: shows that when we are young, we have very high responsibility. One of our major responsibilities is our income from our job or business. The challenge is that our income is usually temporary (nobody works forever) and our needs like food, shelter, clothing, education, etc. are permanent.

2. QII: in quadrant II, typically when we are young, we have little to no savings at all. That’s why we work hard for money to provide for our family and ourselves.esponsibilities is our income from our job or business. The challenge is that our income is usually temporary (nobody works forever) and our needs like food, shelter, clothing, education, etc. are permanent.

3. QIII: due to the challenges in our younger years, we need to solve this dilemma by moving to quadrant III. From younger to older years, we need to build wealth, we need to build our savings and investment lines. The goal is to accumulate enough savings that will support us during our retirement years. With enough savings and investments, we pair it with the right financial knowledge we can then move to quadrant IV.

4. QIV: in this quadrant having the right financial knowledge and enough savings and investment, we can enjoy a life of zero responsibilities. Why? Because this time, we now let money work for us. How?