An Employee's Guide to Achieving Financial Security in America - In several excruciatingly difficult steps

Gentle reader,

Here are some thoughts on making sure that you don't spend your life in a state of continual financial stress. There are a number of steps. I'm afraid the first step is a difficult one. The other steps are difficult also. Hi-ho, let's get started anyway.

The first step is for you to get a very high paying job. How do you do that? Well, it depends on the job but you should definitely spend some time researching jobs that pay well. For some you will need to invest years into college (medicine, law). For some you will need to be extremely smart (Wall Street quantitative analyst). For some you will need to be able to handle large quantities of boredom and stress (management, law). For others you will need the ability to successfully lie to other people (sales, law). OK, I gave lawyers a hard time there. If you have a family and you want a decent house to put them in, you should aim for $100k or above. There aren't many jobs that pay that much these days, you may have noticed. That's what makes this step so difficult. The problem with high-paying jobs is that, usually, the amount of stress you will have to deal with is directly proportional to your salary.

Why such an emphasis on a high-paying job? Well, let's be honest. Inflation has been creeping up (gas, energy, education, little things like that). In particular, housing has gone up by a ridiculous amount over the past 5 years. I find it very frustrating that if I was starting out today I would not be able to afford my own house. I know it's nice for some to have their property value appreciate but not to the point where young people cannot afford to buy a place of their own. So, if you want a decent house you will probably need to make a lot of money.

The second step is for you to live below your means. There are many places you can go to read suggestions (e.g. blogs and finance web sites). I think you should aim to have at least $500 of cash left over every month to save, after all other expenses, including maxing out your 401(k). Maxing out your 401(k) means that you will need to invest around $15k a year, which is over $1k a month. See how step 1 is important? It's difficult to do that on a very low salary, particularly if you have a family. Be wary of the lure of the new car. That will take several hundred dollars a month away for a few years, at least. If you own your own house, your mortgage will most probably be your biggest expense. Don't underestimate heating and cooling as well, depending on where you live. Energy costs are rising far quicker than inflation. Owning a house in general is a constant source of expenses.

The third step is for you to build up an emergency fund. You should aim for around 6 months of expenses, but more is better. Be aware of the fact that if you lose your job, you will probably have to COBRA (continue paying for, by yourself) your health care. That can be EXTREMELY EXPENSIVE for a family. We are talking $1000 a month or more. That cost should be included when you are figuring your monthly expenses. Keep your emergency fund in a high-interest account or treasury bonds, something that is VERY SAFE.

The fourth step is for you to be VERY CAREFUL about your career. You do NOT want to lose your job for an extended period. That is terrible, financially (as well as emotionally). Basic advice here is to avoid companies that are clearly in trouble (unfortunately, most companies will be in trouble at some time, because many businesses are cyclical). If the company you work for is not making a profit, it is cause to be worried and start looking elsewhere. To this point, you must MANAGE YOUR OWN CAREER. Update your skills constantly, make sure that you are competitive. Be aware of current salaries for your type of work. Are you highly paid? BEWARE. You are a target for losing your job unless you are obviously justifying your higher-than-average salary. By the way, it is a fact of life that NOBODY cares about your career as much as you do, so look out for yourself.

Since so few companies offer pensions any more, the fifth step is to invest steadily for your retirement and invest in the right things. Again, you can read books about this. A good one is "The four pillars of Investing" by William Bernstein. Avoid the following mistakes:
* Do not invest all your money in your company's stock! Remember what happened to Enron?
* Do not invest more than a few percent of your savings in any one particular stock. Consider low-cost index funds or ETFs (exchange-traded funds). Google for IYY (Dow Jones total market) or EFA (European large cap).

Also, do not overlook international funds. Many very intelligent investors are sounding warnings about the US economy. Are they right? Beats me. But it doesn't hurt to diversify into European stocks, and maybe consider China and India as well. Once you have picked what you want to invest in, STICK WITH IT. Don't be constantly changing your mind and chasing "hot" sectors. Every day the press focuses on what the stock market has done. Forget about it. You need to invest your money for the long term (20, 30 years). If you are investing steadily (e.g. every month) it is best for you that the stock market goes DOWN for a while anyway, especially when you are starting out. It's like prices being cheap at the supermarket.

Well, that's it, I have run out of advice for now so on to today's quote...

If you're old enough to start thinking about sex, you're old enough to start saving for retirement.
-Phil DeMuth


Until the next time, gentle reader, I remain as always,

your friend,

Buford Twain

What I Believe

Gentle reader,

I borrowed the title of this post from an article written by EM Forster (you can google that if you *really* want a good read).

Here is what I believe, at the tender age of 41. I wonder how much this list will change as times goes on.

1) Nobody on earth (from the Dalai Lama and the Pope to Stephen Hawking) has the slightest idea why we are here, where we are from and what is the meaning of life. If anyone tells me they know, then I assume that they are either deluding themselves or they are lying.

2) Anyone who believes in and follows any of the existing world religions is either deluding themselves or they haven't thought about it enough.

3) The artificial division of the planet into countries, states, etc. is ridiculous and leads to huge problems (see 4).

4) Nuclear war is almost inevitable. The probability of nuclear war is not zero and the amount of time available to have a nuclear war is pretty much infinite.

5) To be happy in life you have to work at something you can be proud of. Artists have a head start.

6) Most people, when taken individually, are decent and sane.

7) Large groups of people with something in common, and particularly those who lead them, are usually to be feared.

8) It is best for a parent to educate their child, if possible and practical.

9) It is terribly wrong to treat people like parts of a machine.

10) The goal of people should be overall happiness. This is sometimes thought of as being the same as wealth. That is a huge mistake.

Today's quote?

Politicians and diapers must be changed regularly, and for the same reason.
-Unknown

Until the next time, gentle reader, I remain,

Your friend,

Buford Twain

Two Weeks Off a Year

Gentle reader,

Somehow, we need to get more leisure/vacation time. Aside from just feeling downright tired all the time, we are losing many ideas and are spending time doing all the wrong things while not having time to do the right things.

Have you ever noticed what happens when you take an extended vacation? I am not talking here about a hectic five day trip to DisneyWorld (TM). I am talking about taking a vacation where you do "nothing".

As you decompress, you start to forget the pressures and stress of your job. You become happier. Time takes on a different feeling. Your time is your own and not somebody else's. You are not as hurried, you can focus on things that YOU want to do, not that somebody else wants you to do.

And after a few days, you might start to notice something else.

If you are like me, after a few days, your brain may start to throw out ideas and thoughts that previously would have been suppressed, pushed to the back of your brain as being too impractical. Thoughts that are radical and "foolish". Big thoughts.

For example, how can I improve life for others? How can I work less and have more time to myself? How can I spend more time with my children? How can I do more of the things that make me happy?

Sometimes, I will get some ideas about how I can make a positive difference to the lives of others. For example, would it be possible for me to set up a network of buses that could carry people economically from the suburbs to their jobs downtown, so they wouldn't need to drive any more? Would it be practical for me to install a big wind turbine near my house, to generate electricity to help
slow down climate change and save money in the long run? How about doing some more writing and maybe even beginning that novel I have been meaning to write? What can I do to organize non-religious people to come together and
do projects for the benefit of others (e.g. helping the poor and elderly)? And so on.

All these thoughts I find far more important than working. And yet, after a week or so, I am forced to go back to work and those thoughts disappear, or are pushed back into the back of my brain, lying dormant.

If we had a more equal balance between work, and leisure, I think we would see many benefits because some of these ideas would be able to see the light of day, instead of becoming pipe dreams. And then I wonder to myself, how many millions, billions of fantastic ideas have died in someone's brain, just because they don't have enough time to do something about them?

Ultimately I suppose the key is to become independently wealthy. I am trying to do that, but it is tough and paradoxically, I find that this requires even MORE time than simply "working for a living". It seems to me like the 2 weeks off a
year rule was set up on purpose to make sure people stay docile, to make sure that they keep their noses to the grindstone and don't think of anything too radical, until they are too old and tired to really do anything beyond play
golf. We are cogs in a gigantic industrial machine that chews us up, and then spits us out. With just 2 weeks of vacation time a year life becomes just a gigantic treadmill, from school, to working, and ultimately to the grave, with precious few redeeming features beyond the joys of friends and family that one doesn't see often enough.

If you read this and you own a company, consider increasing the amount of vacation time you offer. Perhaps you won't immediately realize any financial benefits. But overall, happiness will increase. And isn't that what life is all about?

Time for today's quote:

A man needs a little madness, or else he never dares cut the rope and be free.
-Nikos Kazantzakis


Until the next time, gentle reader, I remain,

Your Friend,

Buford Twain

On Flag Burning

Gentle reader,

There is one thing that seems to have been overlooked by the folks who want to ban flag-burning.

To ban flag-burning is to deny certain rights to your own people.
These rights would then be afforded to everyone else in the world EXCEPT YOUR OWN CITIZENS.

If a flag-burning law were passed:

Citizens of the USA would NO LONGER HAVE THE RIGHT to burn a US flag.

Everyone else in the world would KEEP THEIR EXISTING RIGHT to burn a US flag.

As a British citizen, I could sit in my postage-stamp-sized yard in London (if I still had one) and have a little US-flag-bonfire without fear of major recrimination. Though I'm sure there would be complaints from the neighbors.

As a US citizen, if I tried to do the same, I could be arrested and imprisoned.

To me, that is LOSING FREEDOM.

You cannot legislate respect.

Not for a person.

Not for a country or for its small rectangular, colorful iconic symbol.

True respect, as opposed to mere lip-service, is earned.

It is given to those who deserve it.

The best way to minimize flag-burning is for a country to earn and keep the respect of all people, both inside and outside the country, not by legislation that takes away the freedom of the country's own citizens.


Moving on to the quote of the day...

I realize that all society rests upon force.
But all the great creative actions, all the decent human relations, occur during the intervals when force has not managed to come to the front. These intervals are what matter.
I want them to be as frequent and as lengthy as possible, and I call them "civilization".
-EM Forster

Until the next time, gentle reader, I remain as always,

Your friend,

Buford Twain

A Chicago Ghost Story

Gentle reader,

Some time ago I found myself working for a software consulting company in Chicago which, as it turned out, was only a few short years away from bankruptcy. One of my clients at the time was a retailer that sold what I can only describe as "stuff for rich people who already have too much stuff". After spending a few days poring over the software that ran their web site I discovered some serious problems in the computer code that was being used to process the online orders. I needed to perform an update and I needed to do that at a time when very few people were using the web site. I decided to schedule the update for late on Friday evening.

Well, Friday rolled around, and as luck would have it, the evening was cold and stormy. Living in the Mid-West you come to expect a relentless procession of cold-fronts. A cold front in Chicago can quickly drop the temperature by 30 degrees or more and in late fall you can expect wind and snow. That night didn't disappoint, and I made my way through the driving sleet, passed under the "L" tracks at Wells and Adams and pushed through the revolving doors of the towering office building on West Monroe. A memory flashed through my mind of a consultant from Idaho who had visited me in Chicago once, only to get stuck in the revolving doors, trying to go through the wrong way. He had never in his life encountered a revolving door before. Walking up to the front desk I flashed my ID to the security guard and crossed over to the elevator banks.

I stepped into the elevator and the journey up was enough to allow me a brief and pathetic lamentation on how I was spending my Friday evening. Maybe it was time to move on to a management gig instead of spending my days as a computer jockey. Sometimes the work was frustrating. I had my plan of attack for that night worked out pretty well but I had been around the block enough to still expect some problems to crop up. That's just the way it is with software. Call it Murphy's law. Somehow, things always took longer than you expected.

On reaching the 22nd floor the elevator cut into my thoughts with a cheerful "Bing!". The doors opened and I was greeted by the all-too-familiar office. My home away from home, for the past several years. Instead of being filled with polite chatter though, this time the office just hummed gently with the sound of lonely computers. I made my way to my cube, threw off my coat and got down to business.

I worked more methodically than usual - my normally frantic typing tempered by fear - the particular fear that one can only acquire by having previously fucked-up a company's sacred data. I knew I was at the point of no return. With trepidation, I uploaded the new computer code to the main web servers. The time was exactly midnight.

BZZZZTT!!!

Suddenly, the entire office was plunged into darkness. My computer itself mercifully remained on. It was connected to an "uninterruptable" power supply. However, working in a dark sea of cubes bathed only in light from screen-savers was not what I had in mind. I headed for the elevators. I had just reached the closest elevator bank when out of the corner of my eye I noticed a shadowy figure. Unable to deny that the figure was human, I instinctively reached for the knife that I always carry in the right pocket of my Levis. It was not a knife of any consequence, it was a true nerd's knife, manufactured by none other than Victorinox of Switzerland.

"Who the fuck is that?"

"Hey, how ya doin'? It's just me!"

Oh for Christ's sake. It was our network admin, Regina.

"I'm sorry, but you scared the shit out of me!" I said, trying unsuccessfully to sound calm and in control.

"Yeah, well I heard that you were going to come in to do an update tonight, so I thought I'd at least give you some moral support. And besides, we've been having so many weird network outages lately. I wanted to be sure you could connect to the servers."

With a sense of relief, I told Regina that I was going down to the lobby to try to get our lights turned back on. "Good plan" she said, before walking off toward the server room. That room was still reasonably well-lit, by emergency backup power, presumably. By then, I had realized that the lights in our office was almost certainly on a timer, set to go off at midnight, aimed at saving some electricity.

Sure enough, in the lobby I mentioned the problem to the security guard, who flicked a switch and restored our office lights. I made the trip back up to the 22nd floor and looked for Regina, but she was nowhere to be found.

There was still plenty of work to do. I moved on to the next phase of my late-night project: a little testing. I wanted to be absolutely sure that my new code worked. I submitted a few orders with a special fake credit card. Let's see...I had always wanted a hydrofoil water scooter. While I'm at it, why not take a couple of radio-controlled blimps. Things seemed to be working as well as could be expected. I breathed a sigh of relief. Time to wrap things up. I walked over to the server room, looking for Regina. Unable to find her, I headed for the elevators. Back down in the lobby, I asked the guard to leave the lights on, in case Regina was still in the office. I braved the raw Chicago night one more time, finally making it home around 3am.

The following Monday I walked into the office, as usual, at around 9am. Immediately, I could tell that something was wrong. People were talking in hushed tones in small groups. My boss was in one of the groups so I went over to talk to him.

"Did you hear the news?" was his greeting. He appeared agitated. He continually smoothed over the few remaining hairs on his forhead.

"No, what's going on?" I replied.

"It's Regina - she was in a car accident. She didn't make it."

I felt nauseated.

"But I just saw her! When and where did this happen?" I inquired

"On Friday night. She was hit outside her apartment in Roger's Park just before midnight." was the reply.

A cold shiver ran down my spine. Before midnight?

That summer, on our annual camping trip with the kids and nephews, I recalled sitting by a camp fire, trying unsuccessfully to come up with a ghost story. Next year, I wouldn't have that problem.

Not at all.


Until the next time, gentle reader, I remain,

Your friend,

Buford Twain