Read Financial Materials with Skeptical Minds

I came across the MSN article today — Foreclosure ‘crisis’ is overblown — amidst all the doom-and-gloom financial news.

Excerpt with the main points to save you some reading time:

Though the national rate of foreclosure increased by a whopping 79% between December 2006 and December 2007, the rate was still only 1.033%. Because about 30% of all homes are owned mortgage-free, this means that for all the noise about a crisis, only seven-tenths of 1% of all homes were in foreclosure.

In the top 100 housing markets, the average foreclosure rate was somewhat higher — 1.38% — and it was up 78% over the previous year. But if you rank-ordered the list of the top 100 areas, only 34 had foreclosure rates above the group average. Fifty-one areas had rates of 1% or less.

Foreclosure rates actually fell in 14 of the 100 areas. More important, many of the areas with the highest increases in foreclosure rates were rising off rates that were tiny. The Bethesda, Md., area, to offer the most extreme case, saw foreclosures rise 1,288% — to a rate of 0.682%…

Does this mean we can stop worrying and planning and saving? No, it does not mean that we can overlook the entire real estate ordeal and what’s really happening. However, I think this demonstrate that we need to be skeptical and understand the bias of the authors of the materials we read, despite whatever useful information exist in them. Further more, we must understand the possibility of some financial writers/analysts who exaggerate and write with the agenda to destory/hike a stock for their affiliated short/long position.

This is definitely an emotional time as people’s livelihood may be on the line as the market rises and falls like roller coaster these days. Yet, it remains important to not get carried away by our own emotions and thoughts. Don’t just take other people’s words for granted. Go find out on your own. Keep reading. Keep learning.

Since I said what I did, shall I even trust the article? I’m stumped.

Originally posted 2008-04-01 23:49:14. Republished by Blog Post Promoter

Life is a Process

In life, we move from one goal to the next. We are told that we need to set goals and to reach these goals is success. So in between goals, our focus is solely on the goals. It becomes all about reaching the end.

Let me ask you, “Are you always in a hurry to ‘get some where’ in life?”

I must say, I’m not so sure if it’s such a good idea anymore. I wonder how many moments we lost by living like that. But the fact that everyone is in a hurry in life, so fixated on the “end”, helps to explain why people are so distracted in everyday life. Their happiness is solely dependent on reaching goals. I’m not sure if I like this either. I am even amazed at how much people enjoy the dramas, both good and bad ones, in between also, but I digress.

People are 100% immersed in this little world of “goals”. They allow the emotions and thoughts that arouse from succeeding or failing at these goals dictate them. In other words, reaching goals and success and emotions and thoughts control them. This explains why people genuinely not give a crap about each other also. They are ready to step on another’s toes to cross the road.

My conclusion for now is that everything in life or more specifially, growth in any areas like physical strength, piano, singing, etc. (what I do) is like climbing a mountain. Just when you think you have gone so far, you realize how much farther you can go. No end in sight. It’s a relentless pursuit. What would happen if you base your happiness on these endless pursuits?

It is great to celebrate when a goal is reached. But it’s so enjoyable also realize in between, that you are travelling because you care to expand the effort, and you possess the perserverance, endurance of pain, acceptance of loneliness, and willingness to change. The moments in between goals are important. It is also extraordinarily enjoyable as I am training in many different areas, and by savoring the moments, I discovered so much about myself and the world, both physically and psychologically.

Essentially, the moment is all we have. To find happiness means you treat the moment sincerely. To have faith in the moment is to have peace. To have peace allows you to do things sincerely. To do things sincerely allows for quality.

It is foolish to take life in a completely goal-oriented way. Not that goal is bad. But reaching for goal as extremety is bad. Not only because you are wasting the moments of yourlife, but also because you will ignore the process. Like the economic crisis, we can say it happened because of greed. However, we can also say that it happened because people wnat this arbitrary end of “enormous wealth” and they want to bypass process to get there. It is the same reason why people take steroids to look big and not for medical purpose. We had a economy spiked on steroids and now we reap the side effects.

In a way, I guess I want to say that modern life is a constant struggle to get to these “ends”. But I am writing this to also remind myself to not get sucked into the incessant chasing, to not be in such a hurry. It is important to stop and rest. I like to stay in the moment. And like I said, it’s a struggle sometimes living in this modern world.

Finally, to not treat life as a one integral process is also the cause of the biggest downfall for many people. Why? Examples would be people who diet/exercise for some deadlines, only to turn into Ms./Mrs./Mr. Dunkin Donuts afterward. Or people who enslave themselves with yet another loan after they paid off the previous one.

To think that you “get there” and you can stop is the stupidest thing people can think in life. To stop is to become rigid and therefore allows no change and that means death. To be alive is to be fluid and ready to accept changes to go with the flow in life. Life is a process.

Originally posted 2008-11-02 23:08:05. Republished by Blog Post Promoter

Splitting the bill at a meal with friends and “others”…

friends_dining_painting

So this has been on my mind for awhile. Recently I was at at dinner with my girlfriend, her friend aka Mary, and Mary’s date aka John. The “others” in the title applies to John, haha.

The food was enjoyable, conversation was flowing, and we were having a decent time. The bill came and we split it evenly by 4 while I paid for my girlfriend and myself. No awkward moment on the spot, but there is a minor hiccup…

My girlfriend and I thought and discussed about it later. Neither of us is into drinking a lot of alcohol so we each had one drink for the night. Well, the minor hiccup is that Mary and John each had 3 or 4 drinks for the night.

Our biggest gripe is that neither of them think of to offer to pay a little bit more for the bill. How inconsiderate! At least make the simple gesture, right?

I don't want anxiety for dinner bill...

I don’t want anxiety for dinner bill…

I have no rules and I generally don’t fuzz about a few extra dollars. In this case, the difference is quite a bit more because of the disproportion between the pairs. I let it pass on the spot because I know this is an occasional outing. At the same time, my GF and I now know to be mindful about going out with Mary and a date, lol. Perhaps say something about it before the bill comes next time? Perhaps…

The good thing for me is that the close group of friends I keep are always great about when splitting the bill, none of us care about paying a bit extra while at the same time, we all offer to pay more when clearly we’ve consumed more. Love my friends :)

If I end up dining with a group of new people, I set no expectation and am ready to pay the extra if necessary.

Back to the story… The other point from our discussion is that, this John guy is obviously not that great of a date after all because it obviously didn’t cross his mind that their extra drinking had really tip the bill. This suggests a lack of attention and sensitivity.

I think it’s generally very hard to have rules set-in-stone to deal with these social situation. What do you think? How do you deal with splitting the bill in general?

Originally posted 2013-03-21 00:19:59. Republished by Blog Post Promoter

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

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