IBM 401k plan change

The path of building a nest eggs is full of emotions/surprises.

The path of building a nest eggs is full of emotions/surprises.

There is a spat of news from December that has caused me to think about 401k a lot lately. IBM, one of the largest, employer made a big changes in their 401k plan.

In short, the company used to pay out the matching contribution with each paycheck bi-monthly but starting in 2013, those contribution is paid only once a year in lump sum on December 31 and only if the employee is still employed on December 14. The employees will still receive their own contributions per paycheck in their 401k account.

Nonetheless, it’s good news to company’s bottom line and also shareholders but all bad news for employees because of these cons:

  • loss of the automatic dollar cost averaging over the year
  • loss of potential gain during the year
  • postential loss of all company contribution for the year due to quitting/layoff/firing right before December 14

Before such news, I think there is no question that any person employed in a company that provides matching contribution, he should definitely contribute up to the percentage to receive all those matchings. Now it becomes a bit debatable… though I can see someone may argue, if the employee plans to stay the whole year, contribute to get the matchings. Anyways… It’s important to keep an eye on this and give it some thoughts because IBM is a pioneer in setting the trend for this kind of policy change so stay tune to other companies to follow suit. Just 9% of companies has said policy now.

Outside of the changes mentioned above, if a company is still providing matching contribution, it still makes sense to contribute to receive those.

This goes to show that we should not make 401k our only tool in planning our retirement but instead, treat it as a supplamentary tool. We must combine it with saving and investment plans using our own smart and diligence.

Originally posted 2013-01-10 23:12:55. Republished by Blog Post Promoter

Debt, Debt Awareness, and Debt CC

Debt is a terrible thing… from what I observed during my childhood at least. It was a time (from what I recall) when a person would only take on debt when buying a house, buying a car, starting a business, and at most, paying for the children’s education. And home equity? It is only used as a last resort. And people who borrow to gamble will always end up in pieces somewhere in a back alley.

You are free to call me “old school.”

Now more than a decade later, the world is a different place. Debt has become a commonplace. Consumerism is celebrated. Instant gratification is glorified. Debt is encouraged. The crowd would cheer as you sit on your European imported sofa, watching TV on your newest Sony Bravia LCD, inside your immaculately re-modeled home, which is complemented with a BMW M5 on your front porch. You may be swimming in a sea of debt behind the doors. But it’s aaaaaaalright. It’s totally fine to have debt.

Okay, I admit that the example is a bit extreme, and I know a majority of people don’t end up in debt due to such acts. Life situations could force us into debt. Nonetheless…the meaning of debt has become lost in translation (adverstisement) in this era. Way too much sugar-coating.

Debt Awareness

To begin to understand what debt means, I extracted some definitions from
Debt is something that is owed. Debt is an obligation to pay something.

In other words, when you have debt, it is an obligation to pay back what you owe. Debt is a responsibility. Since you are taking on debt, it means you don’t have much now, so you pay your debt with what you will have in the future. Therefore, when you take on debt, you are betting on your own future. If the future is unpredictable, debt becomes not so good an idea. And it a very bad idea when you take on debt – despite knowing that you simply won’t have “enough future” to pay back. How did we end up in financial crisis again?

Understanding that, it makes sense for a person to take loan for business purpose because they expect future gains that will enable both profit and payment for the loan. Debt is useful in this way. However, when people start consistently using debt to finance leisure and impulse purchase – things that produce no future gain, then there is a slight problem. The problem worsens in a capitalistic society where lenders set high interest rate to obtain sizeable profits, unlike if you borrow interest-free from a generous relative or friend.

Quotes about debt:

The indebted man “must smile on those he hates, he must extend his hand where he would strike, he must speak pleasantly with a curse in his throat”.

“He [borrower] wears dependence like a yoke.”

“The Borrower Is a Slave to the Lender.”

“Be frugal and free.”

Above all, I enjoy how all the quotes emphasize on the same theme of the “loss of freedom” because not only it’s very true, it relates to my biggest concern with taking on mortgage for a home. With a mortgage, I will be “mortally engaged” in the debt with the bank and a stable job to afford it. What if I am to lose my job? What if I want to do something different? I will have much less freedom to do so. I will be “dependent,” “a slave”, not “free”, and “must smile and speak pleasantly” with the bank and with the same job.

Debt CC

For those who would like some help with their debt issues, I introduce Debt Consolidate Care (Debt CC) (2015/11/15: link removed per request). Debt CC is internet’s first get-out-of-debt community that offers professtional help. It currently has over 100,000 members with thousands of practical topics regarding debt covered in the form of forums, wiki, and articles. And with the amount of members, you are almost guaranteed to find some information, tips, and advice concerning your debt scenario.

It’s good to know that Debt CC’s main objective is to make you debt free.

Below is the story of Debt CC and Denny, the found of Debt CC:

Debt – a four lettered word with a far reaching impact on an individual’s financial as well as personal life. Being in debt is an all consuming feeling that people carry around with them 24 hours– throughout their day in office and even at home while spending time with their family. It is rightly said that getting in debt is easier but getting out of it is harder and difficult to confront though it is not impossible. In fact nothing in life is not unattainable, with sheer determination hard work and patience, you can overcome biggest of problems. The story of Denny, the founder of (DebtCC) says it all – from owning a company to sleeping in streets and frantically searching for a decent job to pay off his debts.

Way back in 2003, Denny started DebtCC with the sole intention to extend helping hand to debt crunched people. Since then it has been providing services on debt consolidation, debt settlement and credit counseling to assist people in getting their lives back on track. Being in debt can be very isolating and lonely. That’s the reason the site has an online community (Internet’s first get-out-of-debt community) that comprises of 106724 members where people can communicate with others who are experiencing similar problems. There have been countless instances where the experienced community members have helped individuals seeking financial help with their sound advices. There is a chat section too, where the members can discuss on topics ranging from debt to lost hair pin!

Sadly, most of the people incur monetary troubles because of the lack of financial knowledge. Keeping this in mind, the site has incorporated articles section that has a wide range of information on financial topics written by expert content writers.

You must have heard of the quote by Margaret Fuller that says “If you have knowledge, let others light their candles in it” the wiki section is line with the thought. With the help of this section the community members who are empowered with adequate financial knowledge and keep themselves updated with the latest happenings in the finance world can also write articles to aid the financially challenged people.

Apart from offering out of debt programs, the site has various easy to use tools like debt calculator, e-books, and GPL licensed software that readily serve the purpose of the users.

Originally posted 2008-03-05 01:20:44. Republished by Blog Post Promoter

Business Agenda — Make Consumers Spend!

Sometimes we get too caught up by media and TV about all these things we should purchase and own and to upgrade our life-style to be happier. What they want to do is to brainwash us so we inherently make purchases without hesitation and any deep second thoughts.

How do we defend ourselves? To defend ourselves, we must first understand what we’re facing, so let’s understand these people’s agenda…

The people sellling these “things” are business people. They have their agenda. What is the agenda? It’s none other than – making as much money as possible, under the postulation of a capitalistic society, and guess from whom they want to make the money? Us! We the consumers. We have to understand that they are driven by profit, by business. They need to make their numbers, their quotas because it’s their jobs and we are living in this wonderful society of capitalism. That’s why we must think for ourselves if those things really make me happy.

Now I’m not saying it’s their fault since they are just doing their jobs, but we need to defend ourselves here.
Since the best defense is the best offense…
Let’s take offense in that they are trying to take our money from us!
Let’s be stubborn, stay frugal, and fight against these people who are trying to take money away from us!

Each time you want to buy something, think about if it’s really useful and add values to your life, and make sure you are not buying because they told you so.


Originally posted 2007-09-16 11:54:47. Republished by Blog Post Promoter

Introvert living in a world of extroverts

I maybe quiet, but I may also have great ideas.

I maybe quiet, but I may also have great ideas.

We live in a very loud society. At least, it feels that way.

We either scream at the top of our lung or risk being unheard, unnoticed, unappreciated in today’s world. With the ever more stimulating media and everyone’s craving for attention, we all, in turn, need to continuously speak up, and FIGHT for attention.

More and more talking.
Less and less listening, paying attention.

No wonder people are feeling lonelier than ever.
No wonder we seem to understand so little of each other.

When do we have time for contemplation and introspection? Without which we leave little room for substance to grow, new idea to form, and creative vision to arise. Without such, the words that we keep spewing out lack what was mentioned, and they are just verbal diarrhea. That is, what we excrete out of our mouths are malformed, malnutritioned, perverted ideas that will lead us to a world that we… ultimately don’t want. All because we have to be constantly talking and constantly entertained… so it seems.

This is not to say introverts are better than extroverts. This is all about how unbalanced we have become.

We now deem extroversion as “normal.” Our world is not accepting of personalities that are of an introvert. We usually end up calling those people as boring, or inadequate, or even weird.

We are a society that suffocates those who are more introverted. We demand continuous communication even when it’s unnecessary. We ask for non-stopping display of excitement which is obnoxious to introverts.

I am an introvert. I enjoy being alone. I like having time to read at home. I love playing the piano. I find listening to music with headphones which is relaxing. I can sit somewhere and simply people watch.

I had been in management for almost a year now. It is surprising how criticism would arise mostly from a more mild demeanor that is natural for an introvert. If you don’t try to be visible, shouting words at every chance, you lack leadership and are not acting with a sense of urgency.


I am analytical, I like to take in a lot of information, process, and then arrive at a conclusion. But the environment does not favor that. If I don’t immediately respond, it does not mean I do not care. Being able to be quiet and listen is also where understanding can happen, where appreciation comes from. With inadequate traits of introversion, we become mostly egomaniacs. And that’s how more than the average people would act these days (especially people in management).

That’s why I feel a sense of relief when I came across Susan Cain’s TED talk – The power of introverts:

Finally, the talk of the idea to take the time to stop, to enjoy solitude and to introspect.

Introversion is important. That is how we can understand each other. And understanding is the basis of compassion where we begin to truly care for each other.

I believe in action with grace and humility.

And someone like that can still be exciting, can still have style. Our world should not require people to call attention to ourselves in a sort of self-aggrandizing way exhibitionistic way.

From way back, my quiet and introverted style of being has always left me feeling “out of place” in this society, and it’s still does sometimes.

In conclusion, two obvious idea stand out from these discussion:

1) Our society still benefit from learning and adapting more traits of introversion, and as a result be more tolerant and able to work with introverts who may have some great ideas.


2) Meanwhile, introverts need to compensate, especialy if one wants to be influential, by being more studious and knowledgeable, thus more confident and assertive when the occassion arises that we need to speak up.

In other words, to all you introverts, don’t be afraid to go into hulk-mode if you feel strongly that you need to speak up or you know that you are right!

Originally posted 2013-06-03 04:12:01. Republished by Blog Post Promoter

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