I found this challenge on Mod the Sims.. (here) and liked the look of it, so I started playing. I found it 1.. too easy.. and 2.. lacking in rules for the expansions. So I'm modifying it for my uses. I don't plan to blog the story of my "colony" (town), but I may post some build pictures and stuff as I go. I'm almost done with the first generation currently and I have 3 families (14 total sims) living in my town. Anyway. Back on topic. I wanted to write down my variation of the rules.. mostly so I don't lose them. So here they are. Anything I changed I put in italics.

THE SIMS 4 SETTLER CHALLENGE

Your sim has decided to be one of the brave heroes throughout history who travel to the loneliest places on Earth to find a new home. Your job is to survive and create a thriving colony in the middle of nowhere.

GOAL
To build and to populate your colony. The challenge is over when you've lifted all restrictions. (My goal: lift all restrictions, have at least one of each community lot, and fill all lots except for the city apartments).

SETTING UP
-Set lifespan to normal.
-Aging must be on.
-Create a couple in CAS (young adult or adult). They are your settlers. Pick their traits and aspirations randomly (you can use dice, random.org or this trait generator: https://www.platinumsimmers.com/trait-randomiser/). Choose which one of them you're going to control. (I use http://createarandomsim.com)
-Bulldoze all lots in the world (exceptions: The Bluffs, Von Haunt Estate, Ancient Ruins, and The Secret Lab.) Your sims are settlers and there are no other people living in the colony yet. You may leave one starter house and buy that lot for your sims, or you can build a completely new house or download one from the gallery.
-Delete all households except for the one you made. More will be spawned randomly.
-Choose the starting era for your settlers and choose the furniture, clothes, decorations etc. accordingly. For example, if you want to start in the Wild West in the 19th century, don't buy a television. (Besides, your colony won't have electricity in the beginning in any case.)
-You must use all or almost all your money building and furnishing the house. You can also buy up to three books and one pack of seeds. The point is that you must not have any money when you start the game. If you run out of things to buy for some reason, use a money cheat to reduce your money to zero.

RULES
-You may only control one sim. That sim is called the heir. You will control several heirs during this challenge, but only one at a time.
-There may only ever be one heir at a time. You can freely choose who the next heir is and you can decide when to start playing the next heir, but once you’ve decided, you can’t change your mind and go back to playing the old heir. If you start playing the new heir while the old one is still alive, the old one is not considered an heir anymore.
-The new heir must be the previous heir’s child.
-If the heir has many children, all those children except the future heir must move out when they become young adults - I'm changing this to the heir moves out and "takes" 20k simoleons from the household treasury. (That's not arbitrary, that's the amount that a sim moves into a lot with, so you have to have that much in their parent's bank account to "take with them". Use a cheat to reduce the parent's bank account by this much.) This makes it more of a challenge to earn money the next generation, and allows me to play with many different houses so I don't get bored.
-The heir may marry and move their spouse in.
-You may not age sims up days before their actual birthday.
-Cheats, mods or hacks that give you an advantage over a person who doesn't use them are not recommended.
-If you want to make this challenge easier, you can use one helper (the spouse / sibling / parent etc. of your heir). The helper may do simple tasks (such as repair an object, water plants, cook a meal, feed a baby), but you shouldn't control the helper too much - only a couple of tasks a day. If you don't use a helper, you may notice that the inactive sims in your family won't do much (or any!) work autonomously, which does not feel very realistic in a hard-working colony. Not using this rule.. the challenge is easy enough as it is.
-Traits and aspirations are always randomized when a baby is born or a sim ages up. You can use any random trait generator (e.g. http://www.simslegacychallenge.com/...rait-generator/ or https://www.platinumsimmers.com/trait-randomiser/) or just roll dice. Exception: You may choose the traits and aspirations for the child if either of the child's parents has any of the following traits: Family-Oriented, Patriarch, Mentor. (No changing aspirations until "higher education" restriction is lifted).

RESTRICTIONS AND HOW TO LIFT THEM

School
There is no school in your colony. You must prevent children from going to school.
Requirements for lifting this restriction:
-There must be at least twelve people living in your colony (your family included).

Medicine
Hospital births are not allowed and woohooing may always lead to a pregnancy (roll a six-sided die or use random.org first: 1 means you need to pick the interaction Try for baby instead, and if you roll 2-6 you can just pick Woohoo). You can always choose to Try for baby if you want to.
Requirements for lifting this restriction:
-There must be at least three different community lots in your colony

Electricity
There is no electricity yet. You may not use the computer, the TV, the radio etc. (You may use the fridge, however).
Requirements for lifting this restriction:
-There must be at least four different community lots in your colony AND one of the sims in your current family must have 6 skill points in Handiness -- I'm eliminating this entire rule. People out in the boonies can have electricity fairly easy, whether by cabling to the local grid or using a generator.. I'm putting my guys in this modern era, and it just doesn't make sense to restrict electricity.

Careers
You may not have a normal job as there aren’t any companies or infrastructure. Careers are therefore not allowed, but you may use other means to earn money (painting, collecting, gardening, fishing etc.)
Requirements for lifting this restriction:
-There must be at least five different community lots in your colony
-There must also be at least thirty people living in your colony (including your family)

Higher education
There are no possibilities for higher education in your colony. If you unlock this, you can always choose the traits for your sims when they age up or are born. With this lifted, you can also change aspirations.
Requirements for lifting this restriction:
-You need to lift the restriction School first
-To lift this restriction, one of the sims in your current family must have the trait Genius and be at least a young adult. -- Changing this to the heir needing to have the genius trait rolled in randomly.. so this could be either fast or interminably slow.

Aliens
If you happen to marry in an alien... congrats. You've got alien DNA. If your male heir gets abducted (or the partner of your heir) the alien baby is still allowed to be an heir. If you don't want aliens, feel free to discount this rule.
Requirements for lifting this restriction:
-You need to find an alien to marry or get abducted and have a little blue surprise.

Pets
There are no pets allowed in your town. Once a sim qualifies for being a vet, they can build a vet clinic and lift this restriction. Again, if you don't want pets, just ignore this rule and reroll the Cat or Dog Lover traits on your heirs.
Requirements for lifting this restriction:
-To qualify to lift this requirement, your heir needs to randomly roll either Cat Lover or Dog Lover trait.
-This heir then works towards getting money and setting up a Vet Clinic (requirements for this below). Once the Vet Clinic is built and in service, pets are allowed in any and all families.

Vampires
You may not play a vampire or have your sim turned into one. If you don't want to have vampires, that's fine as well, just ignore this rule and reroll an aspiration if you get one of the Vampire ones.
Requirements for lifting this restriction:
-To lift this restriction, your heir must randomly roll one of the Vampire Aspirations. This heir will then live in Forgotten Hollow when he/she moves out. To become a vampire, you have a choice to 1, make a vampire to turn you, or find one in and amongst the homeless in your town. If you choose to make the vampire, treat him or her as a new "family" to move in.. as they move in you must build them a house (unless, of course, you plan to marry them into the family).
-If your vampire heir's heir 1, does not roll a Vampire aspiration (which is extremely likely) and 2, is a vampire - you must cure them of vampirism BEFORE they move out. Doing this will require your heir to be at level 10 vampire lore and get 10 wolfsbane, 10 garlic, and 10 plasma fruit to make the potion.
-If you choose to make your partner a vampire, and your heirs are vampires, you may control them to 1, feed them, and 2, keep them out of the sunlight. Vampire sims aren't the smartest and the AI will not take care of them on their own.

Strangerville
You may not move into StrangerVille or build any houses or lots there. until . Once you have a sim roll the StrangerVille aspiration, you can then work your way through the aspiration to open the town for others.

Requirements for lifting this restriction:
-To lift this restriction, you need to complete the StrangerVille aspiration and finish the "quest" (No spoilers from me here, but there will be a change in the town once you finish it) Once complete, this town will function just like any other and you're welcome to build lots and move families in.

POPULATING THE COLONY

Yours is the only family living in the colony in the beginning.

Rules for adding families:
-When you are allowed to add a family, create them in CAS or download them from the Gallery. Roll a six-sided die or use random.org to determine the number of people in the family (between 1 and 6).

Different ways to populate the colony:
-Have babies! (For each heir's family, I roll a random number between 2 and 4 to decide the number of kids they'll have. This leaves room for event rolled children.. again, I'll explain that later. This also allows for one non-heir to stay behind to live in the house. I then roll a die for the number of kids to find out which one will be the heir.)
-You can use your Charisma skill to persuade people to join your colony: You can add one family for every sim in your family who has reached level 6 in Charisma. (I'm changing this to being only the heir having the charisma skill, even if you did manage to get a spouse or kid with a 6 in charisma, they cannot bring in another family, only heirs can do this.)
-You can also attract people by hosting great parties. You may add one family for every type of party for which you’ve got a gold medal. You can only invite people who live in your colony to your parties, you can’t invite homeless people!
-Improving the services and the infrastructure in your colony will also make people move into your community. You may add one family for every community lot you add
-Event rolls.. more on this later..

ADDING RESIDENTIAL LOTS

I'm adding info on this, since it's never specifically stated how and when you add new residential lots in the original rules.

When to add a lot:
-When you earn a population increase by either-- 1, your heir's charisma skill, 2, getting a gold on a party (once per party type, not individual party), or 3, adding a community lot-- this family (you roll a 1-6 to figure out how many sims to make in this family) moves in and you build a house for them. Since they won't be played by you, using money cheats to build their house is okay. Once they're moved in, set them as unplayed in the manage households screen (in manage world) and this house is theirs. Should this family all die out, it's free real estate for homeless townies to move into (unless you don't like this idea, in which case you have 3 options: 1, when the family dies out, let the ghosts live there, 2, make a new family (with your 1-6 roll) to move in, or 3, use this lot for the next family set to move in.
-When your heir moves out with their 20k simoleons. Move them into a blank lot and use their 20k to build a starter home that they can add on to as they earn money.
-When you roll to add a four person family on an event roll.. more on this later..

ADDING COMMUNITY LOTS

There may only be one community lot of each type (ie. one café or restaurant, one pub or bar, one library etc.). One heir can unlock and add only one community lot during their lifetime, unless they have one or several of the following traits: Business Savvy, Genius, Ambitious. In that case, they may unlock and add one community lot per each of those traits that they have during their lifetime.  (Edit... I can build more than one of each type, but still only one per heir's lifetime. There's just too many lots for them ALL to be residential, and I want to try to fill all of them except the city lots - haven't decided what to do with those yet.)

When a community lot has a certain cost, you can either pay for that lot or try to fill the other requirements, in which case you won't have to pay anything. If you decide to pay, just use a money cheat to reduce your money by the required amount. -- (Nope. Too easy. The simoleon cost I'm raising from 5000 per lot to 20000... and I require BOTH the skill and the money requirement to build a lot.)

You don't have to add all the community lots listed here in order to win this challenge. You can choose which ones to build. (?? Very confused by this, but eliminating it. No sense to skip any lots when I have all that space to build on!)

A church / a wedding venue / some other nice place for your colony to gather and meet each other (I made mine a Park - generic would also be a good choice.)
This should preferably be the first public building or venue that you create. There are many nice choices in the Gallery (under General), but you can also build it yourself. Just remember not to make it too modern!
Unlocking requirements:
-Cost: 20k simoleons AND your heir must have 6 skill points in Handiness

A café (or) restaurant or a bakery 
Unlocking requirements:
-Cost: 20k simoleons AND OR your heir must have 6 skill points in Gourmet cooking

A pub or a bar
Unlocking requirements:
-Cost: 20k simoleons AND your heir must have 6 skill points in Mixology

A museum or an art gallery (or arts center)
Unlocking requirements:
-Cost: 20k simoleons AND your heir must have 6 skill points in Painting

A library
Unlocking requirements:
-Cost: 20k simoleons AND your heir must have 6 skill points in Writing

A concert hall or a lounge
Unlocking requirements:
-Cost: 20k simoleons AND your heir must have 6 skill points in Guitar, Violin or Piano (or Comedy)

A (National) park
Unlocking requirements:
-Cost: 20k simoleons AND your heir must have 6 skill points in Gardening

A nightclub (or karaoke bar)
Unlocking requirements:
-Cost: 20k simoleons AND your heir must have 8 friends outside the current family

A gym (or pool)
Unlocking requirements:
-Cost: 20k simoleons AND your heir must have 6 skill points in Athletics

A bakery or retail store
Unlocking requirements:
-Cost: The cost of the lot AND all building material and furnishings. This is likely to cost more than 20k, so I'm eliminating needing any skills to open one.

A Spa 
Unlocking requirements:
-Cost: 20k simoleons AND your heir must have 6 skill points in Wellness skill

A Vet Clinic 
Unlocking requirements:
-First, your heir MUST randomly roll either Cat Lover or Dog Lover trait as they're growing up. Once you have an heir that qualifies, they can start building their Vet Clinic
-Cost: The cost of building the lot and furnishing it. This isn't cheap, and you raise Vet Skill by actually doing it, therefore there is no skill requirement for this building.

If you want, you can roll a random event every Sunday to keep things interesting (use dice or random.org). (I did some moving around of options, and removed one completely. I didn't feel the war on the borders killing the young adults was appropriate given the fact that I'm setting it in the modern era.) To make things even more interesting, you can roll both Sunday and Wednesdays like I am.

1 The spring festival makes people romantic. Add a new baby to a random female in your colony (Manage Worlds -> Household Management -> Edit sims in CAS).

2 A casanova moves into the community, sweeps one of the female sims in town (I changed this from having her be in your family. roll off the eligible females to decide which one it is.) off her feet and knocks her up. Pick the female sim randomly. That sim may even be your heir if your heir is female. Instructions: Create the casanova in CAS (if you haven't already), move him into the female sim's house and make him Try for baby with the selected sim. You can then move him out if you want to (if you move him out, make sure you build him a home or put him in one of the existing empty homes).

3 A flood destroys the house of one family in your colony (pick randomly) and you want to help them. Move them into your house. You may move them out after one week if you want. -- I found this rule to be a nightmare in practice.. most of the time, I couldn't get the family to move in because there's not enough room in the household and I don't play with mods... so I changed this to: Another Casanova (female, this time) moves in. Instructions same as above except the sim you make is a female and moved in with any eligible male in town. (which means even elders count, because she's having the baby, not him).

4 A family asks if they may move into your colony. Create four sims in CAS and move them into your colony. (I took out the "you decide" .. why wouldn't you want more sims?!)

5 Fire! One of your community buildings has burnt (pick randomly). You may rebuild it using your money if you want to, but it will cost 5000 simoleons. If you don't want to rebuild it, bulldoze it.

6 One of your current heir’s children feels that they cannot bear the responsibility of building a colony. That child isn’t allowed to become an heir. Select the child randomly. (If your heir doesn't have children, nothing happens.)

7 The autumn festival makes people romantic. Add a new baby to a random female in your colony (Manage Worlds -> Household Management -> Edit sims in CAS).

8 Your Mister Casanova is at it again! This time a female sim from another household gets pregnant. Pick the female sim randomly. Instructions: Create the casanova in CAS (if you haven't already), move him into the female sim's house and add a baby to that family in Household Management.

9 Problems with the building permit office. If you can raise your Logic skill by two points (unless it’s maxed already, in which case you succeed automatically) in the next 24 hours, you’ll be able to convince them that your requests are rational and nothing happens. If you can’t raise your Logic by two points, you may not build anything before next Sunday.

10 Another family asks if they may move into your colony. Create four sims in CAS and move them into your colony. (I took out the "you decide" .. why wouldn't you want more sims?!)

11 Oil has been found in your colony. Use the cheat Motherlode or some other money cheat to add 50000 simoleons to your family funds.

12 One family decides they wants out and sells their home and moves away. This is figured out by a roll of all non-related families. (If you've married in sims from a family, that exempts them from this roll. Family in the area means they aren't likely to leave the area.) Leave their home as-is and evict them, then delete them from your household list. Feel free to save them to your library in case you want to use them later for something else, or have them move back in on an appropriately numbered add family roll. (obviously, this means that families with more than 6 sims won't be able to move back in).

I added three more events in the third generation:

13 Add baby to a MALE sim in a household. Just for something different.

14 Another family asks if they may move into your colony. Create four sims in CAS and move them into your colony. (I took out the "your decide" .. why wouldn't you want more sims?!)

15 The second female Casanova to round out the total Same instructions as above.

16 Add baby to a MALE sim in a household.