Archive for the 'Career' Category
Tuesday, January 24th, 2012
The Daily Beast has an article Consumption Makes Us Sad? Science Says We Can Be Happy With Less by Barry Schwartz (author of The Paradox of Choice) that serves as a nice compilation of various psychological and behavioral economics findings about money and happiness.
The first main topic is hedonic adaption. When things are awesome, we eventually get used to it (celebrities, lottery winners). When things are really awful, we tend to get used to that as well (disabled persons). This is why it’s hard for people to achieve a constantly higher level of happiness. We get a nicer car/house/toy, we get used it, and then soon we want an even nicer car/house/toy, never getting anywhere as if we are walking on a treadmill.
Simply knowing that the good feeling from that purchase is only temporary may help you cut back on your spending. In addition, author Dan Ariely suggests you deal with the hedonic treadmill by pacing yourself when it comes to experiencing pleasure, and (when needed) making painful cuts all at once. For example, you might not buy a entire home theater setup all at once, but perhaps upgrade one component and wait until the shine completely wears off before buying a new couch. If you need to cut costs, it may be better to make a big spending cut by downsizing your house rather than cutting things you’ll miss repeatedly like your daily coffee or selling your stuff on eBay piece-by-piece.
The second main topic is how most of us get more pleasure out of doing stuff than out of having stuff. This especially applies to activities with other people and/or activities that we find important and worthwhile. A nice result form this is that those activities often cost very little or nothing. I think this concept is related to the research by Daniel Kahneman that found that happiness did not increase past earning $60,000 a year.
Below 60,000 dollars a year, people are unhappy, and they get progressively unhappier the poorer they get. Above that, we get an absolutely flat line. I mean I’ve rarely seen lines so flat. [...] Clearly money does not buy you experiential happiness, but lack of money certainly buys you misery,” he said. But the real trick, Kahneman said, is to spend time with people you like.
We all need a certain amount of “stuff” (and thus money) to make us feel physically healthy and safe from harm. Past that, adding more stuff doesn’t seem to help. Schwartz suggests that at some point, one might even stop looking for a job that pays more, but instead go for a job that makes us feel valued and doing something important. Of course, more money can get you to early retirement faster if you’re into that sort of thing, so there is a balance to be made.
Friday, December 2nd, 2011
The conclusion from this Harvard Business Review article has stuck with me all day. Researchers looked into whether people think of their success as the result as either hard work or innate talent, and how it affected them later on. The distinction turns out to be important. Something to think about if you’re raising kids as well.
How often have you found yourself avoiding challenges and playing it safe, sticking to goals you knew would be easy for you to reach? Are there things you decided long ago that you could never be good at? Skills you believed you would never possess? If the list is a long one, you were probably one of the bright kids — and your belief that you are “stuck” being exactly as you are has done more to determine the course of your life than you probably ever imagined. Which would be fine, if your abilities were innate and unchangeable. Only they’re not.
No matter the ability — whether it’s intelligence, creativity, self-control, charm, or athleticism — studies show them to be profoundly malleable. When it comes to mastering any skill, your experience, effort, and persistence matter a lot. So if you were a bright kid, it’s time to toss out your (mistaken) belief about how ability works, embrace the fact that you can always improve, and reclaim the confidence to tackle any challenge that you lost so long ago.
On a related note, have you heard of the Dan Plan? Apparently a guy read Malcolm Gladwell’s book Outliers about how it takes 10,000 hours to become an expert at something, and decided that he wanted to go from never playing golf before to winning a PGA Tour event. He’s somewhere around 2,000 hours now. Even though I think I would have picked something different, I’ll definitely have to check back on his progress later.
Wednesday, July 6th, 2011
Over the long weekend, a few conversations rekindled my curiosity about gaining a Certified Financial Planner (CFP) designation. Now, I really don’t want to be a financial planner. I’m quite happy with my current career right now. I primarily want the CFP knowledge to help me manage my own finances, but to be honest I might be willing to pay a little extra to put the initials after my name.
According to the CFP website, the three main steps are (1) the education requirement, (2) passing the exam, and (3) the 3-year experience requirement. The education requirement can be fulfilled by a $2,000 online course that takes 6-8 weeks, or can be skipped if you are a CFA, CPA, ChFC, or CLU already. The exam costs $595 to take. The 3-year experience requirement is the most difficult for me, as I won’t have time to rack up 6,000 hours of “experience in the financial planning process” unless writing this blog counts. Annual renewal fees are $325 a year.
What if I just want the education at the lowest cost? There are several online CFP Board-Registered programs each with their own curriculum, but they tend to share the same six overall course topics. Both Boston University and UCLA Extension make their textbook lists public. 6 courses times 6 textbooks times ~$110 a textbook = $660. But we all know that publishers like to simply do some light housekeeping and pop out a new edition every other year to force students to pay up. The older edition usually at least 95% the same, but at a fraction of the new price. I took the BU textbook list and went comparison shopping:
Introduction to Financial Planning
Personal Financial Planning Theory and Practice, Dalton
6th edition (2009) costs $125 new at Amazon
5th edition (2008) costs $30 used at Half.com
Risk Management and Insurance
Introduction to Risk Management and Insurance, Dorfman
9th edition (2007) costs $157 new at Amazon
8th edition (2004) costs $2.50 used at Half.com
Investments: An Introduction, Mayo
10th edition (2010) costs $183 new from AbeBooks
9th edition (2007) costs $7 used from Half.com
Prentice Hall’s Federal Taxation 2012: Individuals, Pearson
2012 edition costs $155 new from Amazon
2011 edition is $55 used from Half.com
(I can see the benefit of having the most up-to-date tax book, but it’s not like I’m going to buy the latest version of this book every year. I’d just try to keep up with any changes.)
Retirement Planning and Employee Benefits
Retirement Planning and Employee Benefits for Financial Planners, Dalton
6th edition (2010) is $75 new from Amazon
5th edition (2008) is $18 used from Amazon Marketplace
Fundamentals of Estate Planning, Fontaine
12th Edition (2010) is $67 used from AbeBooks. (Couldn’t find it new?)
11th Edition (2008) is $4.20 used from AbeBooks.
Adding up the used prices for these 6 books, the total comes to about $120 (plus shipping and taxes, used prices change regularly). This seems like a more economical way to achieve the knowledge for the DIY set. Chances are, you could even use them with an official course if you really wanted to.
I’d be willing to bet that I could read through these previous editions of textbooks and pass the CFP exam. It’s 10 hours long, but I read that it’s also all multiple-choice. I wish I could try. However, it appears that just to sit for the exam, I must pay for a $2,000 course that seems to primarily consist of some online videos. I can definitely see the benefit of videos for audio/visual learners though, as I’m sure the textbooks can be pretty dry stuff.
Tuesday, March 15th, 2011
I am currently reading The Art of Non-Conformity by Chris Guillebeau (review coming shortly). In one of the early chapters, he talks about an exercise where you write out how your perfect, idealized day would go in great detail, hour-by-hour. I’ve read about this method other places, but never actually write it down. As I go into it, I found myself getting really into it and making several changes throughout today. Here goes:
I wake up, naturally, after 8 hours of sleep. Many people don’t need that much sleep, but I do. I love waking up naturally, but will set an alarm as a backup, because… I have to wake up the kid(s) and get them ready for school. I still don’t have kids, but I really want them.
I make their lunch, and perhaps drop them off at school in my 10-year old Honda if it’s close enough. I take the dogs for a walk in the neighborhood park. I then do my exercise for the day. Most days it will be something active and fun, like swimming, bicycling, tennis, or running. To mix it up, sometimes with a buddy or group. Swimming in open water is fun, since I live by the ocean.
Morning to Early Afternoon
I shower and change into shorts and a t-shirt. I work at home and live in a temperate climate, so that’s what I wear every day. At the computer, I check the morning’s e-mails and do some work. Work consists primarily of reading books and online articles from thoughtful authors (not 24/7 cable news or superficial fluff), and then researching and writing on topics like personal finance, nutrition, web design, or graphic design. I actually only do specific jobs for clients occasionally, because I’m tired of dealing with customers. Writing is so much less stressful. I might also run a small e-commerce website, but nothing that requires constant attention. Part of the year, I teach something small at a local community college.
I only work 4 hours a day. I can do this because I’m smart with money and have saved up a big chunk. Mrs. MMB works half-time as well, still 9-5 downtown, but only 2-3 days a week. With a relatively simple lifestyle, our income still pays the bills with a little left over. Our portfolio is left to grow for “advanced” retirement once the kids are in college and Mrs. MMB quits completely around age 50. I feel like I’ll be doing something that earns income until at least 60.
I work until a late lunchtime, and then I take the dogs for another walk. If Mrs. MMB’s not working that day, we do this together. She loves to garden and much of our food comes from there. Some days, we walk to a local eatery with the dogs and dine al fresco.
I wait for the kids to come home from school or pick them up. We ate some snacks, then I help them with their homework. Next up: sports, 4-H, girl/boy scouts, or science club or whatever fills up the afternoon. I love being able to spend time with them. We shop every day at a local market for ingredients for that night’s dinner, before the after-work rush. Did I mention I never have to go to Costco or any megastores on the weekend?
Dinner is a family affair. Once a week, the grandparents come over for dinner or we go over to their place, since we live in the same city. After dinner and homework is finished, perhaps a DVD or pre-planned TV viewing. I could say “NO TV!!!”, and I’d still like to severely limit TV viewing in the house, but do think there is good content out there. Why not watch it together? Otherwise, we might play a board game or learn about that year’s Big Adventure. I am not a fan of video games at all, unless educational and done well.
I used to worry that once I had kids, I wouldn’t be able to travel anymore. However, I’ve been learning about parents who take their kids traveling around the globe for a year or longer. I don’t think that’s my style. I’d rather visit one single country/region for an entire month during the summer. I call it Big Adventure. Renting a house or apartment for the entire month would be more economical, and we could use that house as a base. During the rest of the year, we could research the country’s language and culture to plan out activities.
After the kids go to bed, I’ll probably be exhausted as well. If not, I’m sure I’ll poke around the internet some more before I pass out.
How would your perfect day go?
Monday, January 10th, 2011
Below is a chart of the median duration of unemployment from July 1967 to December 2010, based on data supplied by the US Department of Labor. Things are bad out there, and remember, this is just the median!
According to this December 2010 report from the Bureau of Labor Statistics, out of the 9.4% unemployment rate, 44.3% of them are considered long-term unemployed (those jobless for 27 weeks or more). That means over 4% of the total US workforce – 6.4 million people – has been unemployed for over 6 months.
Which leads to the poll question of the week. How prepared are you for an extended period without a paycheck? In this case, by emergency fund I am talking about a cash (or similar) cushion that is accessible, not lines of credit.
If you don’t see the poll above, you may be viewing the RSS feed and should click and visit the actual blog website.
Wednesday, December 22nd, 2010
While procrastinating today, I of course ran across a couple of tips on productivity and success that both powerful and very different.
First is an essay called Good and Bad Procrastination by Paul Graham. It includes a lot of insights into procrastination, and my favorite was the idea that it was okay to put off less important, scheduled, to-do list-type things whenever you get a chance to focus and do some really great things:
The reason it pays to put off even those errands is that real work needs two things errands don’t: big chunks of time, and the right mood. If you get inspired by some project, it can be a net win to blow off everything you were supposed to do for the next few days to work on it. Yes, those errands may cost you more time when you finally get around to them. But if you get a lot done during those few days, you will be net more productive.
In fact, it may not be a difference in degree, but a difference in kind. There may be types of work that can only be done in long, uninterrupted stretches, when inspiration hits, rather than dutifully in scheduled little slices. Empirically it seems to be so. When I think of the people I know who’ve done great things, I don’t imagine them dutifully crossing items off to-do lists. I imagine them sneaking off to work on some new idea.
The second is the Jerry Seinfeld Productivity Secret by Brad Isaac:
He told me to get a big wall calendar that has a whole year on one page and hang it on a prominent wall. The next step was to get a big red magic marker.
He said for each day that I do my task of writing, I get to put a big red X over that day. “After a few days you’ll have a chain. Just keep at it and the chain will grow longer every day. You’ll like seeing that chain, especially when you get a few weeks under your belt. Your only job next is to not break the chain.”
“Don’t break the chain,” he said again for emphasis.
This idea of incremental change is not new – see this post on Kaizen for example.
Some things are best achieved when you attack it a little every day – things like debt reduction, learning a language, or weight loss. Other things you may have to wait for the inspiration, but when it comes, it pays to put it above all else. Perhaps a great business idea or investment opportunity.
Monday, October 11th, 2010
The following is a guest post from reader Leslie, who shares her story of returning to the workforce by starting her own business in Florida. You can see more of her work at on Facebook and soon at LALGraphicDesigns.com (currently under construction).
As a thirty-five year old mother of three, for the past decade I have been fully employed as a stay at home mom. When my first child was born I put my career aspirations and four year college degree aside to focus on raising our children. Before motherhood, I used to work as a graphic artist doing on-air graphics for a local TV station and a national satellite TV provider. Now that all the kids are all in school, with encouragement from friends and family, I recently started my own home based graphic art and design business. This is the story – or at least the first chapter – in a story which just began to be written about my home based business.
After “retiring” to run our household, I kept my artistic and computer skills fresh over the past several years by volunteering and providing free graphic arts services for community organizations, schools, friends and family. Samples of school T-shirt and business logo designs are copied in the margins. Although I committed my energies to raising our children, I had always wanted to run my own business. As set forth below, my contacts through our local parent teacher associations and charities have developed into business clients.
Formation and Formalities
Read the rest of this entry…
Wednesday, September 22nd, 2010
Here’s an interactive chart from the NY Times of how various groups of people spend their time over the course of a day.
Like many of you, I have fond memories of college. Here’s one reason why; The pie chart below shows the average full-time college student spends their day.
“Educational activities” only take up 4.5 hours a day (including studying!), and even if you add in work it totals only 6.5 hours a day. This paper says this is over 30% less than a few decades ago.
Full-time students allocated 40 hours per week toward class and studying in 1961, whereas by 2003 they were investing about 27 hours per week.
While college is more cush, like we discussed before tuition is growing more expensive at an alarming rate. And even while people say “tuition bubble”, this chart shows that it’s been going on consistently for a long time. Hat tip to Economix blog.
So it seems, we are either getting a lot less education for our money, or we’re just getting charged more for giving them more amenities for their paid vacation, or both. At this rate, my kids will just download course material directly into their brains from iTunes, spend the rest of the four years on vacation, and college will cost a full decade’s worth of income. That $100 auto-investment into a 529 just ain’t gonna cut it…
Thursday, July 22nd, 2010
Above is a chart of the median duration of unemployment from the past 50 years, based on data supplied by the US Department of Labor. That’s quite a scary spike we have going right now. (Chart source, via The Atlantic and Greg Mankiw.)
Not coincidentally, the Senate just voted to extend employment benefits again after much debate. This means that the federal government will continue to provide up to 99 weeks of unemployment assistance, including the first 26 weeks provided by individual states.
People will argue whether this is the best way to combat the problem. I don’t know the answer, especially with the huge deficit, but I do feel that with two years of unemployment available that there is less excuse not to learn some new marketable skills if you need it. Also, this just makes my cash hoard of a year’s worth of expenses that much more important to me. I really didn’t think an emergency fund would provoke such a strong psychological response, but it has significantly lowered my daily stress levels.
If you don’t have your warm fuzzy cash hoard yet, open a separate online savings account and start socking something away! Just look at the chart again if you need motivation.
Wednesday, May 26th, 2010
Nobel laureate and founder of behavioral economics Daniel Kahneman performed a TED Talk this year about how as humans our “experiencing selves” and our “remembering selves” perceive happiness differently. Basically, he says that our memories of experiences differ from what really happened during the experience itself.
But what ended up being the catchy soundbite was in the Q&A session after his talk, where he tells us that while millions of dollars won’t buy you happiness, a job that pays $60,000 a year might help. This is based on a survey of 600,000 Americans:
“Below 60,000 dollars a year, people are unhappy, and they get progressively unhappier the poorer they get. Above that, we get an absolutely flat line. I mean I’ve rarely seen lines so flat.”
“Clearly… money does not buy you experiential happiness, but lack of money certainly buys you misery,” he said. But the real trick, Kahneman said, is to spend time with people you like.
I found this talk through the GatesVP blog, who offers this analysis:
In most parts of the US you already have access to a very good and healthy life at 60k. You’ve pretty much covered everything commonly deemed as a necessity and you probably have some money left over for “entertainment”. So the jump to 90k really just gives you a little more “entertainment” and maybe some bigger stuff, but that’s it.
And if you’re the type who’s not happy with being in the top 20%, then how much further do you need to go? Top 10%? Top 5%?
Really, 60k for one job is far enough “ahead of the game” to keep happy those that can be kept happy. And that’s probably why this is true.
According to the 2008 US Census, making 60k a year is in the top 20%. I pretty much agree, especially with the idea that humans are creatures of comparison. As long as we’re doing a little bit better than our neighbors, then we tend to be happy. What do you think?
You can view the entire TED Talk below. The Q&A session starts at about 17:15, and a transcript is available on the right sidebar here.
Read the rest of this entry…
Monday, May 10th, 2010
The most highlighted passage on the Amazon Kindle eBook device is:
…the more money they made the next day on the streets. Those three things—autonomy, complexity, and a connection between effort and reward—are, most people agree, the three qualities that work has to have if it is to be satisfying. It is not how much money we make that ultimately makes us happy between nine and five. It’s whether our work fulfills us.
From the book Outliers by Malcolm Gladwell. Full list via MR and @willwilkinson.
Thursday, March 25th, 2010
I ran into a friend today that has been unemployed for a while. He seemed pretty beaten down, and doesn’t even really seem to be trying anymore. “1 out of every 10 people can’t find a job.” Almost like that stat made it okay. Well, it does seem like a huge amount of people. Is there less stigma attached to being unemployed now?
However, he does have a degree and some experience. This reminded me of a graphic in Businessweek of the benefits and costs of college. They compared unemployment rates when separated by level of education. People who don’t have a high school diploma have triple the unemployment rate of someone with at least a bachelor’s degree.
You can view the original article here [pdf], which also has an interesting chart showing that higher education expenses have been increasing at double the rate of medical care since 2000. College tuition and fees are up 92% (!) since 2000. That trend simply can’t continue… can it?