Change That We Don’t Believe In

We believe in change where we force everything outside of ourselves to change for us, maintaining status quo or continuity as much as possible — even if it means beating everything else into submission with force, often in the name of goodness.

We don’t believe in change where we change and grow ourselves in junction with the ever changing world deemed external to us.

If genuine change means first to look into ourselves and then outside for understanding before the action of change, what we truly believe is pretentious change.

Thus we are now seeing the consequences in various aspects of society around the globe that somehow, and in most cases incomprehensible to our logical minds, turn out to be hideous and disastrous — despite all the claim and acclamation of goodness, morals, and positivity.

It is as if we are promised gold, but when we finally come to realization, we have cow poo in our hands. Except, it is none other than ourselves that promise us gold.

Originally posted 2011-01-22 15:07:58. Republished by Blog Post Promoter

Debt and Conspicuous Consumption Speak Fundamental Problem

2007111850020101.jpgDebt and conspicuous consumption are symptoms of a much fundamental problem.

The subprime crisis, consumer debt issue, and negative national saving rate don’t happen together out of sheer chance like giving birth to triplets. They demonstrate the change in people’s values and perception from past decades. What is the difference?

It is a fact that life can be a bitch and some are very unfortunate to be much handicapped to begin with. However, it is also a fact that they are the minority of the population who have no choice being in poverty. Here today, let’s focus on the majority of the population who has the luxury of the freedom to choose.

At the end of the day, people deep down know what they need to do for themselves regarding their finance, but somehow somewhere along the timeline, people stop admitting to reality and ignore what they know. They prefer to be denial, and may even do their best to stay in ignorance, so they can justify themselves. Ah, ignorance is a bliss… but not really. There is always a choice, and people choose to be ignorant so they can be superficially happy through materialism and instant gratification. They like taking the easy way out, though it is only temporary, but they don’t care if it’s only temporary.

Being in denial, people try to become something they are not. And whether they know it or not, that builds up a void within… you can think of it as a spiritual void or a feeling of emptiness. Call it what you want. As this void gets bigger, people try to fill it with external things, which are paid for with money or credits — money they don’t have. These external things provide instant gratification and the perfect noise to mask that void. As time goes on, they lose a great deal of responsibility, integrity, discipline, and compassion with such behaviors.

I don’t think people should blame credit cards. Credit cards are merely financial tools and dead object. Like subprime mortgage, like all other forms of intelligent(dumb)financing program. Like money. They are all dead objects. How can they be held accountable? Companies make them available, and people choose to use them.

I think life is structured a way that allows us to make many mistakes. We can make a lot of mistakes at different times, as long as we recover from each. And frankly, we all make mistakes in life. We need to do our best to stay aware and catch and correct mistakes as quickly as we can. I cannot fathom that it is one big mistake that brought everyone down to their knees. Humans are tough and adaptive creatures. The key lies in being aware and always learning — the opposite of being in denial and ignorant.

It only becomes the big issues today as people remain in denail and continuously make the same mistakes, until one day — WHAM!!! — they found out they are holding on to a thread hanging off a cliff. They tried to chase after the something that they vaguely see and believe that will bring happiness but won’t and now they need to catch themselves before they fall. They need to recover from their mistakes, and they will if they choose to.

Indeed, we need external things for survival and for pleasure. It’s a part of life. But when you look to ONLY externals for happiness, you are chasing after shadows.

I believe happiness happens when you look within yourself first. When I said to look within yourself, I mean to find the values in life that are important to you. You need to get to know yourself. Know what you want in life. To each person, there are many important values, so you must prioritize, and I dare claim that no one should have money and fame at the top of the list. With such a list, you shall know what is “enough” and hence, be able to distinguish between “wants” and “needs”. You can then simplify your life and not have excessive externals yet be content, though remember being content does not mean being satisfied and complacent.

Problem happens when people never stop to find out their values. Again, they try to become what they are not. I don’t believe it is entirely the people’s fault because of how they become conditioned the way their are — constantly being distracted by advertisements, bombarded with information, and conditioned about money/appearance/fame. As a result of those: They think they will be happy when others see them as rich. They think they will be happy when they have that next-best-thing. They think they will be happy when they beat their neighbors.

However, there comes a time for each of us to come to understand that such a culture doesn’t work and therefore, learn not to buy into such a culture. It is not easy, but it is what we need to do. This is where discipline comes into play, and where we take responsibility for ourselves.

So at the same time you are learning and reading about all those “methods” on how to get rid of debt or to build your wealth, why not take a pause to learn about yourself and get your values straightened out? Because if you don’t, your changes will likely be short-lived because your character has not changed.

You can shred your credit cards, but if you don’t fix the problem by fixing the fundamentals, the problem will come back as easily as it is to shred the credit cards.

Originally posted 2008-03-28 10:22:28. Republished by Blog Post Promoter

Time end Amazon Prime membership (and how-to)

Today, Amazon announced that they will raise the annual subscription price for Prime membership from $99 to $119, a 20% increase.

After some self-reflection, I have decided that it is no longer worth it to pay the fee. $99 was borderline extravagant for me. Aside from the 2-day shipping, I do not make use of all the other services that come with Prime membership. On top of that, even without 2 days shipping, I remember that many items still have free 3-5 days shipping (correct me if I’m wrong).

Steps to end your annual Amazon prime membership :

  1. Go to Amazon.com
  2. Click on “Your Account” or “Accounts & Lists” near top right
  3. Click on the “Prime – View benefits and payment settings” box toward top right
  4. Click on “End Membership and Benefits” link on the left
  5. Click on “End My Benefits” button
  6. Click on “Continue to Cancel” button
  7. Click on “End on [date]” button

And you are done. Your Prime membership will now expire at the stated date.

To be honest, I am not too fond of the wordings because they purposely word the buttons as if the membership will end right the way. I can only guess their intent where most people will have a psychological block to end membership immediately rather than allowing the membership to expire.

Don’t Max Out Your 401k Annually

These days, every time I read a blog or some online article where people simply preach about 401k or are celebrating their annual max out of 401k contribution, I… just chuckle. That’s me being polite.

chained-money

People, please stop blindly echoing and following each other. Do some studying, learning, thinking for yourself. There are certain things you need to consider, keep reading.

First thing first, if your company provides 50% or 100% matching of certain amount or percentage of your contribution, by all means, take advantage of it. Beyond that, perhaps you should re-consider the benefits and the (over)hype of 401k.

Now, pay attention to the points below. For each, take a minute and pause and see if it makes sense. Don’t just take my words for it.

  • The MAJOR premise of using [traditional] 401k is for the delay of income tax so that more of our money can grow until we withdraw. However, at the rate our national debt is going, do you think a bet on having low income tax rate in the future is a smart bet? Especially when income tax rate for low to medium income households are very low currently.
    Update 03/24/2012: A counter to this point would be to use Roth 401k if that’s available in your plan
  • Following previous point, withdrawal from 401k account is taxed at income tax rate, versus, withdrawal from taxable account and only its gain is taxed at capital gain tax rate. If government must raise taxes, which is likely to be increased more? Which is likely to be lower in the future? Seeing the trend of the United States government, the answer is that income tax rate will likely increase more while capital gain tax rate remains lower.

    “But 401k grows with pre-tax money, blah blah blah…” Yes I know. But with 401k, we are trying to plan for a future that is VERY far down the road, and therefore, we should make a more conservative plan. I would rather bet on the a taxable account outside because there is less variables, meaning, I know the taxed principal will be there (I should have a good percetage back to “cash” near “old age”). Better to overestimate than underestimate.

  • Depends on the 401k account management, the chance for shady, kick-back, and “hidden” fees is not negligible.
  • Many 401k accounts do not provide “good” selection of funds.
  • A common argument for 401k is that it’s forced-saving. BUT! Generically speaking, if you need you money to be locked up in order to save, there is a bigger situation about yourself that you need to confront and handle. Namely, responsibility, discipline, foresight…
  • The population is aging. More people are retiring than people joining the workforce. That means likelihood of more people selling (whatever that’s left in the account) stocks and bonds in the 401k than people buying in. This adds more downward pressure against future stock growth. Plus, we have to be cautious with our belief in future growth in general.
  • Lastly, we don’t live forever and can very well die before 60s. I am not sure about locking up all that money, that I cannot access and use without penalty except for some very “dire siutations” (ahem, hardship withdrawal…). There can be good argument against this, but I still think there is value in this thought. Mainly, we are not immortal. Stop living and behaving like we are.

So now you have my skepticism with 401k. Again, if there is matching from your company, get it. That’s “free” money. Otherwise, it would be a good idea to spread things out some in taxable accounts than having full belief and your $$$ in the 401k basket. It’s not that difficult… just following the same allocation in both places. You do have some ideas of your portfolio allocation, right?

Meanwhile, I contribute to my company’s matching. Maxing out my 401k yearly? I’ll pass.

Update: Thanks Meg for pointing out my confusing comments with Roth IRA which is corrected. It is my own decision not to. If interested why I don’t, read comment.

Originally posted 2012-03-24 23:33:23. Republished by Blog Post Promoter

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