Healthcare FSA Warning: Average Lost Contribution was $300-$400 Per Person

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It’s mid-December. Do you know where your Healthcare Flexible Spending Account (FSA) contribution are? If it’s still sitting in your FSA, your employer may be waiting to pocket it shortly (subject to possible carryover or grace period). Money.com analyzed government data and found some concerning stats on these “use-it-or-lose-it” accounts: Workers Lose $3 Billion a Year in FSA Contributions (and Employers Get to Keep It). Here are some highlights:

  • About 40% of the private workforce has access to FSAs.
  • 44% of workers with FSAs in 2019 forfeited money. On average, the amount lost totals $339 per person. In 2020, those numbers went up: 48% forfeited some amount, while the average amount was $408.
  • In total, FSA holders forfeited an estimated total of $7.2 billion in 2019 and 2020.
  • Legally, all those billions of forfeited dollars are allowed to be kept by the employer.

This is why I send out a year-end reminder every year with ideas on how to use up your FSA funds. Amazon even has a special FSA-eligible page where you can link up your FSA/HSA debit cards and everything is already filtered for your convenience.

The flip side: Your employer can’t claw back spent funds, even if you use your entire annual allowance early on in the year, and your employment ends mid-year. Let’s say you set aside the maximum $3,050 for 2023, and have corrective eye surgery in January, spend it all, and get reimbursed for the full $3,050. Even if you get fired in February and have only had about $250 in salary deferral contributions, you are not on the hook for anything further.

From this SHRM article (HR site for employers):

Generally, the uniform coverage rule does not allow employers to charge an employee for the balance of a health flexible spending account (FSA) if the employee leaves employment mid-year. The rule requires that the full amount elected by an employee for an FSA must be available for reimbursement at any time during the coverage period or plan year. Employers cannot limit the amount of reimbursement to the amount the employee has contributed thus far during the plan year. Additionally, employee contributions may not be accelerated based on the employee’s incurred claims and reimbursements.

This supposedly makes it “fair” that the employer keeps unused FSA funds, but I am willing to bet that the amount of unused contributions far outweighs the used-early-then-left-work funds.

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How Much Income is Enough? $20,000 A Year More Than You Have Now

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Here’s a graphic of how much additional income Americans say that they would need to “feel happy and less stressed”, as compared to their current annual salary. Taken from this Axios newsletter and data from this Empower survey.

On average, those with annual incomes of $150,000 or less said they would need ~$20,000 more per year. At annual incomes of over $150,000, folks started needing a lot more, both in percentage and absolute terms. That’s just how us humans seem to be wired. We quickly grow accustomed to our current situation, and imagine how nice an extra $1,500 per month would be.

But here’s a different perspective. If you make $80k, you think you’ll need $100k to be happy. If you make $100k, you think you’ll need $120k to be happy. But this also means, if you make $100k, you’re already at the happy point for someone making $80k.

In other words, someone out there is getting through life reasonably fine with 60% or 80% of your salary, while also daydreaming about how nice it would be to have 100% of your salary. That other person is also spending closer to 60% or 80% of your salary, even if only because they have no other choice and are confined by their income.

Why couldn’t you spend like them? Taking your monthly rent or mortgage. It could be higher, or lower, and someone is living in each of those homes that represent 20% less or 20% more than you are paying now. Take your transportation costs. How would a car that costs 20% more or less change your level of life satisfaction?

Don’t just wish for more money, examine the money that you already have from the perspective of someone who is wishing to be you. Now you already have the extra money. Would that money be better spend put aside and buying more income-producing assets? Would that money be better spent on improving your skills and career prospects? Or would it be better on moving to a more expensive home that reduces your commute time so you can have less stress and more quality time with your family?

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How to Choose Your Career: Venn Diagram

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Despite my great affinity for Venn diagrams, I don’t recall seeing this one about how to choose a career by engineer/comedian Don McMillan. I found the routine through a random YouTube video recommendation:

Here is the slightly-less-likely-to-offend version from @donmcmillan, which swaps “OCD” for “anal retentive” and “lawyer” for “politician”:

Definitely some truth in his humor. I’ve definitely cycled through enough jobs to know that I am not a good fit. I could fake it for a while, but it just gets exhausting. You definitely want to choose a career that fits your personality:

caddell620

p.s. Here’s a random bonus Venn Diagram of three vegetarian recipes from the NY Times:

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Charlie Munger Fireside Chat with Todd Combs (April 2022): Full Recording and Transcript

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Charlie Munger held a fireside chat with Todd Combs back in April 2022 as part of a Singleton Prize for CEO Excellence event, and more recently a full audio recording and full text transcript has been made available. The talk covered a variety of different topics, which fans of Berkshire Hathaway/Buffett/Munger-style wisdom will likely value. Found via Neckar and Kingswell (both excellent substacks on value investing topics).

I enjoyed this quote about the power of combining internal motivation and long attention span:

Warren was around me and he used to say, “You really don’t need to be very smart to be a very successful investor.” And I think Warren was right. It’s a field where the temperament is, it’s good to have the extra mental horsepower that Henry Singleton had. That is helpful, but it’s perfectly possible to do splendidly well if you have the right temperament. Just go at it over a long time. You talked about me. I’m not a polymath. What I am is a guy who has been able to take moderate obsession and a long attention span and turn them into pretty good results. Of course, a long attention span will help you a lot, if you’re reasonably smart.

[…] I don’t know how to fix [inaudible]. I’d love to be able to wave my hand and solve that problem, but I don’t think that’s given to man, to fix some of those problems. So I just stay away from the problems that can’t be fixed and pick the ones that can – I don’t like unlimited failure. I don’t want to fish forever and never catch a fish. I have to have some reinforcement. And so I pick some things that can be done and do them. But I do think that if you’re reasonably obsessed with something, even if it’s intermittent, and you have a long attention span, you keep working over the serious problems, that you’ll stumble into an answer. That’s half the secret of life.

However, I also noticed he added in a point about picking the right problem to solve. I’ve previously shared this Venn diagram by Bud Caddell:

caddell620

You do need to pick something where you have a natural “obsession” or “passion” because it will help you keep at it and not give up. However, most mortals should add in a bit of practicality and pick an area for which you at least have a little bit of talent and that isn’t completely impossible or saturated with competition.

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Examples and Stories of Working Less on Purpose (to Live More)

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My philosophy on financial freedom essentially boils down to believing you have the power to make choices that affect your life. Do not accept that the world is against you and that there is no point in trying. Everyone is dealt different cards, but it’s how you play them that matters. Your job title, your employer, the number of hours per week, where you live, the size of your home, your commute time, how you spend the 4 hours each day that most people spend watching TV – these are all variables that you can change. Be different. Or don’t. But choose them consciously.

The WSJ article Would Life Be Better if You Worked Less? (gift article, should bypass paywall) shares the stories of several Americans trying to “live more” by shifting to part-time hours or four-day workweeks and accepting the accompanying lower income.

Granted, I don’t know if I would have used a “part-time” neurosurgeon still working 40+ hour weeks as my first example. Of course, if you have a high income, then you are ideally suited to cut back your working hours and still maintain a comfortable lifestyle. For others, a few years of high savings rates may be required first to help you build up that financial base so that you can eventually cut back hours or otherwise take more risks to improve your life.

I found this quote interesting about how a little work is good to provide us with a feeling of purpose and value, but you don’t need a lot. This would support the concept of assuming you’ll work a little forever, which should lower the savings requirement to reach that point. It doesn’t have to be all or nothing.

Humans need work to give structure to our days, to bestow purpose and self-esteem, he says. But we don’t need that much of it. A 2019 paper from Prof. Burchell and several co-authors found that people performing one to eight hours of paid work a week got the same mental health boost—less anxiety, less depression—as those who work 44 to 48 hours a week.

The referenced 2019 paper appears to be this one: An exploration of the multiple motivations for spending less time at work, which includes many more stories and quotes from people tinkering with the amount of time that they work.

The paper separates negative “push” factors like long hours, work intensity, and low job satisfaction and “pull” factors like realizing your life is short and time is limited, the attraction of leisure activities, the desire for freedom in general, family concerns, and the ability to varied and more fulfilling work.

The main purpose of sharing all of these examples is to show you that there isn’t just one path. There are many other people who are purposefully working less than full-time, making less income than they could make, and getting something they value in return (the time to do something else). You may be inspired.

It would be nice if these articles dived more deeply into the sacrifices made before and during the switch to such part-time status. How did they negotiate a 4-day workweek with their employer? How do they plan to compensate for the added risks like cut hours during a recession, or the lack of benefits like health insurance? How long did they have to save to get there? In our case, I was only comfortable downshifting after first working 40 to 80 hours weeks and saving 50%+ of net income every year for a decade. We didn’t retire completely from paid work into an ultra-frugal minimalist lifestyle, nor did we go for dual full-time high-powered careers with lots of outside childcare help, but gradually found an in-between path that worked for us.

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Better Future: Free Background Check Powered by Checkr

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(Update 2023: Better Future suspended their free background checks during the pandemic, but I just noticed that they are back up and running, An inaccurate background check can prevent you from getting a job, so it is better to check now and start the process to dispute any incorrect information immediately.)

While updating my posts on free Consumer Data Reports, I noticed that Checkr offered a free background check via the BetterFuture.com website. No credit card required, no trials. Checkr is a legitimate company that provides background checks for Uber, Lyft, Postmates, and Instacart, so I valued their results more than most other “free lookup” sites.

The benefit of knowing what is on your background check is that you can fix any inaccuracies before applying for employment. In return, Checkr makes money by trying to connect you with relevant job opportunities based on your unique information.

Better Future takes your basic information (name, address, SSN) and pulls data from federal databases and public records from over 3,200 local counties. The sections of the background check report are:

  • Address History
  • SSN Trace
  • Sex Offender Search
  • Global Watchlist Search (International crime databases)
  • National Criminal Search
  • County Criminal Searches

I decided to run a free background check on myself, and it only took about an hour even though it said it might take up to 3 days. The information shown was all correct to my knowledge. Here’s a redacted screenshot of my report:

The background check does not include Employment History, Driving Records, or Civil Records. Here is the disclaimer that comes with the report:

This background check is for the named individual only. Better Future searched the sources listed below based on the information you provided. Failure to provide accurate or complete information may affect results. Third parties, such as potential employers, may search other databases for information about you. This is not a “consumer report” as defined by the Fair Credit Reporting Act (FCRA) and may not be used for determining any person’s eligibility for credit, insurance, employment, housing, or for any other purposes covered under the FCRA.

Bottom line. Checkr offers a free background check via BetterFuture.com. No credit cards, no trials. In return, they can match you up with job opportunities (optional). I signed up for a free report and I found no errors in the information.

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Off the Clock: Feel Less Busy While Getting More Done (Book Highlights)

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If you are serious about dramatically improving your personal finances (like getting rid of credit card debt), the first step is to find out exactly where your money goes – track every dollar for a month using a spending log. I recall it being quite uncomfortable, but also eye-opening. In the same way, the book Off the Clock: Feel Less Busy While Getting More Done by Laura Vanderkam is based on the detailed hour-by-hour time diaries of thousands of people.

What characteristics make some people both feel less busy yet still spend time on the activities that are important to them? Some of the highlights below you may have seen elsewhere, but I did discover some new, actionable advice.

Know where your time goes. Track it. Reflect.

As a born skeptic, I had long been fascinated by what these logs showed about the blind spots people have about time. There can be great gaps between how we think we spend our time and reality as recorded. People claim to have no leisure time and then can recount in detail what happened on the most recent Big Bang Theory. Or—I was guilty of this one—we feel like we spend hours unloading the dishwasher, only to learn it takes five minutes each time, the four times per week we do it.

First, people who feel like they have enough time are exceedingly mindful of their time. They know where the time goes. They accept ownership of their lives and think through their days and weeks ahead of time. They also reflect on their lives, figuring out what worked and what didn’t.

It is not that people who have more free time have the time to reflect. After all, people with low time-perception scores actually spend more time on social media and TV than people with high time-perception scores. Instead, people allocate time to thinking and reflecting, and then they feel that they have more time.

Get rid of time-wasting activities. Check your e-mail less often. Check your phone less often. It wastes time, makes you more anxious, and it doesn’t create lasting memories. Be aware and perhaps limit your TV time.

They scrub their lives of anything that does not belong there. This includes self-imposed time burdens, such as constant connectivity, that clog time for no good reason. Indeed, one of the most striking findings of my survey was the gap in estimated phone checks per hour between people who felt relaxed about time and those who felt anxious.

Accept the “good enough” and even “better than nothing”. Aim for small, daily habits that move you steadily towards your goals. Five minutes towards your goal every day is so much better than nothing.

They let go of expectations of perfection and big results in the short run. Instead, they decide that good enough is good enough, knowing that steady progress over the long run is unstoppable.

What type of person do you want to be? What do you want to be known for spending your time on? Pick your worthwhile struggle. Spend time on the important people in your life.

There is freedom from things we don’t want to do, but there is also freedom to do the things we want to do, and figuring out the right balance requires understanding when commitments are burdens and when they are benefits.

These choices involve commitments, but they also stretch time, because as you choose to spend time on these things, you become in your mind the kind of person who has the time to spend on these things.

Happiness requires effort. It is not just bestowed; it is the earned interest on what you choose to pay in.

If my anticipating self wanted to do something, my remembering self will be glad to have done it. Indeed, my experiencing self may even enjoy parts of it. I am tired now, but I will always be tired, and we draw energy from meaningful things.

Outsource the other pain points if possible. Outsource the chores and errands that cause the most stress and/or block other productive pursuits.

In my life, learning to use childcare strategically has been a big breakthrough.

Fight for more flexible hours or less hours at work. The author shares stories about an engineer that had to find a new job first and threaten to quit, before the old employer would allow them to work at home for 4 days a week. (Sounds familiar!) Others have cut their work hours to 80% of full-time or 50% of full-time (if they can afford the accompanying loss in income). However, I found this quote to be useful work advice:

Of course, not all organizations or jobs are amenable to part-time work, and sometimes going off a full-time track can have far-reaching implications for a person’s career. I find that part-time options tend to work best in careers (such as medicine) where hours are more set and you are either in the office or not. The danger in other kinds of salaried work, as my time-diary studies have found, is that if no one knows how many hours anyone is working, “part-time” can often mean full-time hours for less pay. If that sounds like the reality of your industry, it might be a more satisfying option to hunt for (or craft) a job you love, and then negotiate for flexible hours in lieu of extra cash. If you do elect to take a pay cut to go part-time, work out a schedule where you get real days off—for example, you don’t go into the office Thursday or Friday—rather than accept vague promises of a reduced workload. This has the virtue of reducing work hours and commuting time too.

Ready to do your own time diary? The author provides free timesheets (including PDF, xls, and Google Sheets versions) for her 168 Hours Time Tracking Challenge at LauraVanderkam.com where you can track your own time for a week.

After tracking your time, look back over your schedule and ask yourself a few questions: What do I like about my schedule? What would I like to spend more time doing? What would I like to spend less time doing? How can I make that happen?

This book was published in 2018, but the author also has a new book Tranquility by Tuesday: 9 Ways to Calm the Chaos and Make Time for What Matters that just came out October 2022, although I have not read it and don’t know how it differs from this book.

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Your Workplace Is Not Your Family. You Will Be Replaced Immediately. (Why F- You Money is Awesome)

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A big takeaway from my time on the Early Retirement Forums is that while many posters struggle with the decision to leave their jobs, those that have done so rarely look back. If you are a hard-working, competent employee, it’s very likely your boss will be highly reluctant for you to leave. Employers may demand a full year of notice before leaving (only to let you go early once a replacement was found), plead and guilt you about abandoning your “family”, or simply abuse you until you break.

My wife used to be a very loyal employee that genuinely enjoyed going to work. However, over the years, that changed. The COVID pandemic only accelerated the problem. If you read this NYT article about how “non-profit” hospitals actually make huge profits (gift article), you can get an idea of what happened:

More than half the nation’s roughly 5,000 hospitals are nonprofits like Providence. They enjoy lucrative tax exemptions; Providence avoids more than $1 billion a year in taxes. In exchange, the Internal Revenue Service requires them to provide services, such as free care for the poor, that benefit the communities in which they operate.

But in recent decades, many of the hospitals have become virtually indistinguishable from for-profit companies, adopting an unrelenting focus on the bottom line and straying from their traditional charitable missions.

She didn’t want to leave. She wanted to feel like a valued worker in a safe environment that actually followed their claimed “mission statement”. When that failed, she just wanted an unpaid leave of absence. They denied her that too. The best way to tell this story is through a role play:

Worker: I need to voice my concern that the recent policy changes are detrimental to employee safety and patient care, even though you say that patients are your top priority.

Employer: No, of course not! You are a greatly valued employee. Have a company-branded mug!

[months pass]

Worker: Why did all the lower level staff receive a pay cut when none of the executive team received a pay cut?

Employer: We hear your concerns and will take them into consideration in the future! Would you like a company-branded backpack?

[months pass]

Worker: Dear Management, I am burned out.

Employer: Everyone is burned out! We are a team! Let’s go team!

[months pass]

Worker: It’s been several months. I feel worse. I request an unpaid leave of absence.

Employer: You are a critical part of our team. You will hurt the rest of your team if you quit. We need you!

[two weeks pass]

Worker: I am still very burned out. I am concerned about my physical and mental wellbeing. I officially request an unpaid leave of absence. I don’t want benefits. I just need a break. Please.

Employer: We officially deny your request. Please read this glossy pamphlet on how much we value “Employee Mental Wellness”. See you at work on Monday!

Worker: Okay. Well, I quit. Here is my official letter of resignation.

Employer: What?!? Really? Okay, okay, you can have the leave of absence. Sheesh.

Worker: Too late. I quit.

Employer: Wait, wait, wait. You win! We will give you a 3 month paid leave of absence! With benefits! Stay! Please? Pretty please?

Worker: I decline your offer. You already showed your true colors.

Employer: This is outrageous! You are just being unreasonable!

[a week passes]

Employer: We already hired someone to replace you. We had to pay them double what we paid you. Don’t forget to turn in your name badge.

(I tried to add some humor, but all this stuff actually happened. I can show you the backpack.)

Many co-workers and friends advised her to just take the three months of “free” money and then quit again afterward. But things had changed. She wanted a leave of absence to take a break and re-assess. She was unsure. When she was denied that simple and reasonable request, she no longer had to re-assess. She now knew that she would never go back to work for this current management team. Perhaps they should have read this Linkedin article Don’t beg employees to stay as they leave:

It’s disrespectful to the employee. When employers don’t consider an employee’s request for something to change to make their work environment better, the employee feels devalued. I’m speaking, of course, about high performers. You may not ever be able to make everyone happy but the worst thing you can do to your highest performers is to make them feel less than what they really are to you. Waiting until they threaten to leave to make a change doesn’t help. It takes a lot of energy for them to look for another job and go through interviewing processes. It is completely disrespectful to them when you make them an offer to stay only when you realize they can go somewhere else. […]

I’m not suggesting you give employees everything they want, not even your highest performers. The point is you need to take off the blurry glasses and at least take a hard look at what’s going on in your workplaces, how you are treating your best employees and consider making meaningful changes before you lose them.

The power of having F— You Money the ability to jump ship when you know it’s sinking, as you know you’ll be okay no matter what. She could explore her options, and already has a new position lined up. Otherwise, you may have to start your search while still working. But don’t let your employer convince you to stay longer with guilt trips and meaningless words. If your company treats workers like cogs in a machine, something to be constantly tracked and monitored, then they won’t hesitate to find replacement parts (even if those replacement parts cost them double due to their short-sightedness).

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


Improving Your Everyday Negotiating Skills (Never Split The Difference Book Notes)

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Initially, I viewed Never Split the Difference: Negotiating As If Your Life Depended On It by Chris Voss as a tactical financial book for specific situations: buying a car, negotiating a salary, buying a home, renegotiating rent, or any number of business transactions. After all, the author is the “FBI’s lead international kidnapping negotiator”!

Instead of a win/lose mentality, this book helps you find out what the other person really wants overall, what they will accept specifically within your own acceptable range, and to do it in a way that everyone feels respected. I found myself using the advice every day for all the little negotiations in life: getting the kids out the door in the morning, finding out why someone was mad at me, and so on. Admittedly, I had (and still have) a lot of room for improvement, but this book helped improve my communication and listening skills. I highly recommend reading the entire book, but here are a few selected highlights and excerpts.

What are the goals after learning these skills?

What were needed were simple psychological tactics and strategies that worked in the field to calm people down, establish rapport, gain trust, elicit the verbalization of needs, and persuade the other guy of our empathy. We needed something easy to teach, easy to learn, and easy to execute.

It all starts with the universally applicable premise that people want to be understood and accepted. Listening is the cheapest, yet most effective concession we can make to get there. By listening intensely, a negotiator demonstrates empathy and shows a sincere desire to better understand what the other side is experiencing.

Mirroring. Here’s a very simple tactic that you can try today (really! try it on your very next conversation) to help get more information, called “mirroring”:

It’s almost laughably simple: for the FBI, a “mirror” is when you repeat the last three words (or the critical one to three words) of what someone has just said. Of the entirety of the FBI’s hostage negotiation skill set, mirroring is the closest one gets to a Jedi mind trick. Simple, and yet uncannily effective.

It’s just four simple steps:  

1. Use the late-night FM DJ voice.
2. Start with “I’m sorry . . .”
3. Mirror.
4. Silence. At least four seconds, to let the mirror work its magic on your counterpart.

Here’s a short YouTube video with examples.

Labeling. We want to get on the same page. People want to be heard and understood. We can try to confirm a perception gently, show that we are listening, and validate their emotions with “It seems like…” phrases.

There are fill-in-the-blank labels that can be used in nearly every situation to extract information from your counterpart, or defuse an accusation: It seems like _________ is valuable to you. It seems like you don’t like _________. It seems like you value __________. It seems like _________ makes it easier. It seems like you’re reluctant to _________. As an example, if you’re trying to renegotiate an apartment lease to allow subletters and you know the landlord is opposed to them, your prepared labels would be on the lines of “It seems as though you’re not a fan of subletters” or “It seems like you want stability with your tenants.”

Here is an example from a grouchy relative at Thanksgiving:

“We don’t see each other all that often,” you could say. “It seems like you feel like we don’t pay any attention to you and you only see us once a year, so why should you make time for us?” Notice how that acknowledges the situation and labels his sadness? Here you can pause briefly, letting him recognize and appreciate your attempts to understand what he’s feeling, and then turn the situation around by offering a positive solution. “For us this is a real treat. We want to hear what you have to talk about. We want to value this time with you because we feel left out of your life.”

“How” and “What” questions are much more gentle and respectful ways to guide the conversation along. It frames it is as a collaborative effort and asking for help, not being accusatory or demanding was “Why”.

Here are some other great standbys that I use in almost every negotiation, depending on the situation:  

What about this is important to you?
How can I help to make this better for us?
How would you like me to proceed?
What is it that brought us into this situation?  
How can we solve this problem?  
How am I supposed to do that?

Instead of “No”:

The first step in the “No” series is the old standby: “How am I supposed to do that?” You have to deliver it in a deferential way, so it becomes a request for help. Properly delivered, it invites the other side to participate in your dilemma and solve it with a better offer. After that, some version of “Your offer is very generous, I’m sorry, that just doesn’t work for me” is an elegant second way to say “No.”

Used properly, these little things can really improve your everyday life. Learning about “negotiating” doesn’t mean you like fighting or painful conflict, it can actually mean less painful conflict:

If this book accomplishes only one thing, I hope it gets you over that fear of conflict and encourages you to navigate it with empathy. If you’re going to be great at anything—a great negotiator, a great manager, a great husband, a great wife—you’re going to have to do that. You’re going to have to ignore that little genie who’s telling you to give up, to just get along—as well as that other genie who’s telling you to lash out and yell.

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103 Bits of “Advice I Wish I Had Known” by Kevin Kelly

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via GIPHY

Kevin Kelly of Cool Tools and many other endeavors is now 70 years old and has 103 more bits of “Advice I Wish I Had Known” for 2022. Very high density of insightful wisdom per sentence, so I like to read a little bit each day and hopefully let it sink in. Here’s a small selection:

– Don’t ever work for someone you don’t want to become.

The biggest lie we tell ourselves is “I don’t need to write this down because I will remember it.”

– Your growth as a conscious being is measured by the number of uncomfortable conversations you are willing to have.

– Habit is far more dependable than inspiration. Make progress by making habits. Don’t focus on getting into shape. Focus on becoming the kind of person who never misses a workout.

I missed last year’s version, so here are some from the 2021 version:

– That thing that made you weird as a kid could make you great as an adult — if you don’t lose it.

– If someone is trying to convince you it’s not a pyramid scheme, it’s a pyramid scheme.

– Most overnight successes — in fact any significant successes — take at least 5 years. Budget your life accordingly.

– To be wealthy, accumulate all those things that money can’t buy.

– Children totally accept — and crave — family rules. “In our family we have a rule for X” is the only excuse a parent needs for setting a family policy. In fact, “I have a rule for X” is the only excuse you need for your own personal policies.

Too often, advice like this just goes over my head until I’ve already had to learn it the hard way first. Still, worth a try to gain some wisdom the easy way.

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The Four Core Types of Regrets + Thoughts on Financial Regrets

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According to the new book The Power of Regret: How Looking Backward Moves Us Forward by Dan Pink, only 1% of people say they never feel regret. Here are the most in-depth articles from the media tour: WaPo, BBC, Atlantic.

In 2020, the author Daniel Pink launched the World Regret Survey, the largest survey on the topic ever undertaken. With his research team, Pink asked more than 15,000 people in 105 countries, “How often do you look back on your life and wish you had done things differently?” Eighty-two percent said regret is at least an occasional part of their life; roughly 21 percent said they feel regret “all the time.” Only 1 percent said they never feel regret.

In the book, Pink identifies these four core types of regret:

  • Foundation regrets involves an irresponsible choice that changed the course of your life. This includes not saving enough money for retirement, not taking care of your health by eating well and exercising, or not putting in proper effort at school or work.
  • Boldness regrets come from being too cautious, and not taking certain risks. This includes staying in a “safe” job instead of going for a career changes more suited to you, or not asking out someone you liked on a date.
  • Moral regrets are when you don’t live up to your own values. You cheated, bullied, lost your temper, or didn’t stand up for something.
  • Connection regrets deal with lost relationships with family members, friends or colleagues. Too often, this happens due to neglect and passivity.

I used to think of regrets as equivalent to mistakes. In our household, we try to look at mistakes as a positive opportunity to “make your brain grow bigger”. This way, they are less afraid of trying something new or challenging. Regrets are simply mistakes, so we should just learn from them and move on, right?

However, now I see regrets as a special sort of mistake. They involve looking at the past and imagining different outcomes. Over time, you realize what kinds of choices are likely to lead to regrets, and what won’t. This can help guide you towards better future decisions. To me, the phrase “no regrets” doesn’t mean I don’t have any regrets. It means I know what will cause regret, and so I do things to avoid it. For example:

  • I won’t regret ditching a little bit of work for dedicated one-on-one time with a child. If you have kids, read The Family Board Meeting.
  • I won’t regret saving a few months of expenses to ride out life’s inevitable bumps.
  • I won’t regret waiting 24 hours to send that angry e-mail.
  • I won’t regret reaching out to a friend, whether it is because you need it or they need it.
  • I won’t regret taking the time to show or tell someone “I love you”.
  • I am much more likely to regret not taking a chance, than taking a risk and failing. In many cases, the downside isn’t so bad, while the upside could be limitless.

In terms of financially-related regrets, the two big ones are the foundational regret “I wish I saved more money when I was younger” and the boldness regret “I wish to took the risk to pursue a career better aligned to my personality and interests”.

A study by the Federal Reserve Bank of New York found that only 27% of college graduates work in a field related to their major. Career paths are long and winding these days. I remembering choosing my college major when I was 17 years old, since some colleges make you pick on your application. Even though I questioned my choice after a few years in college, I felt the “sunk cost” bias and didn’t want to risk the additional time, effort, and tuition to try and change majors. I was also “good” at the major, and so I kept going. That is one of my personal regrets.

In my view, finding the right career path where you get the trifecta of “I am good at this”, “I like doing this”, and “I get paid well for doing this” is like having a jetpack on your pursuit of financial independence. Once you have a job where you wake up and actually look forward to go to work and there is a small but increasing gap between income and expenses, you are ready to blast off and start compounding. You could try and pursue financial independence with a job that is missing any one of those three factors, but the journey will feel like a slow grind instead.

Eventually, the fact that I was missing the “I like doing this” starting bugging me enough, and I was ready to quit and go back to school. But the first thing I had to do was save up a year of expenses (also helped by minimizing those expenses). That little money cushion gave me the courage to make the leap. The “ROI” on that “emergency fund” was more than any index fund or rental property. So that’s what I plan to tell my kids: When you’re young, live simply and always create a cash cushion so that you can keep searching for the jetpack trifecta. This will minimize your financial regrets.

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Anthony Bourdain: Not Too Late to Change Your Direction

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[Programming note: Posting will be light through the end of the year. Hope you have a restful and rejuvenating holiday season!]

The WSJ article Anthony Bourdain: Feast of Memory (link should bypass paywall as I am a WSJ subscriber) briefly highlights four different books that all explore his life and legacy from different perspectives:

So far, I’ve only finished the first one. This observation hit close to home:

At the news of his death, millions of people mourned—and not the way that we mourn a commodity celebrity, with a sharp breath of sorrow and a fleeting salute and a sad-face post on social media. Millions of people mourned Bourdain the way you mourn a friend: primal, personal, disbelieving, unreal, unhealed.

A good Bourdain quote:

“I used to think that basically, the whole world, that all humanity were basically bastards,” he tells John W. Little, in a 2014 interview for Blogs of War. “I’ve since found that most people seem to be pretty nice—basically good people doing the best they can.”

On being an enthusiast:

I’m passionate to the point of being evangelical about things that I love, that give me pleasure, and make me excited. And, um, you know I didn’t really travel until I was forty-two years old, I spent my whole life in kitchens. I’d seen nothing of the world. So, this is all still relatively new to me. People have been very kind to me. I feel very, very, very fortunate.

[…] I don’t feel like I’m an advocate, or a spokesperson for anything. I’m just, you know, I’m an enthusiastic son of a bitch.

Bourdain made a huge dent in the world after the age of 44. I took special notice that he didn’t publish his breakout book Kitchen Confidential until he was 44 years old. He wrote the book as memoir of sorts, by someone who felt at the end of his career. I am now 43 years old. I also feel at the end of some things, and smack in the middle of other things. Perhaps the trick is to also feel at the beginning of something new.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.