Friday, September 11, 2015

Don't Bide Your Time

In the summer when the rain begins
Better hurry, don't bide your time
Better get all your winter things
Better gather, don't bide your time

Keane, Russian Farmer's Song

This has been a difficult and chaotic year, which has reinforced in my mind the importance of putting your finances on autopilot through processes and automation.  The saving, the investing, the giving - these should all be effortless.  The fact that these sorts of things glided along this year for me is an acknowledgement that things had been set up properly.

More recently, I've been able to get back to active pursuits in various areas.  Mainly this involves setting medium and long term goals and executing them.  I cannot stress enough how important this is to one's overall quality of life.  Study after study in all walks of life - athletics, business, health, relationships, etc. - all show the same thing: the chance of success is dramatically increased by setting goals and writing them down.  For any particular endeavor, only about 10%-20% of people have specific goals, and only about 1%-2% actually write them down.  Yet the high achievers almost all come from that small group.

I would also suggest monitoring your goals regularly to see if anything needs adjustment.  The way you plan and execute may need to be different for certain tasks or for certain times of life.  For example, lately I have noticed that I have been efficiently completing medium sized goals left and right, but my long term goals are mostly stalled.  Since the completion of long term goals is nothing more than breaking them down into medium size goals and executing those smaller goals, then clearly the problem is that my long term goals have not been broken down properly.  I am currently in the process of fixing this issue.

Remember that without goals you will be largely directionless.  This makes you vulnerable to wind up simply as a tool that someone else will use to fulfill their goals.  So either way, you will probably be working toward someone's goals.  Wouldn't you rather it be yours?

Saturday, August 8, 2015


"Toledo was just another good stop along the good king's highway..."
- Yes, Our Song

Of the thousands of rock lyrics that have been quoted over the years, this may be the very first mention of the above line from the progressive rock band Yes.  While not to be confused with great poetry, there is nonetheless a hidden gem here.  Do you know why Toledo is called out?

Toledo is mentioned because on a previous tour, the band played a concert there in an arena where the temperature inside reached 126 F, and probably even hotter on stage.  But far from complaining, the band merely viewed the concert as "just another good stop" on the tour.  Such is the power of flow and the power of doing something you love to do.

Contrast that with a lot of early retirement blogs.  I actually feel sad when I read many of them.  So much time and effort is spent making extra money and scrimping on expenses, and yet in the end, a lot of people only seem to aspire to more of the same.  One early retiree posted his weekly time schedule:
  • 20% - Eating
  • 20% - Household Chores
  • 15% - Video Games
  • 10% - Blogging
  • 10% - Reading
  • 10% - Relaxing
  • 5%   - Working Out
  • 5%   - Child Care
  • 5%   - Misc
Really?!?  Wow.  The irony, of course, is that if you added work, the list would probably look exactly the same as before retirement.  In other words, all that effort throughout life was simply about being able to stop working.  Everything was about avoiding something they didn't like to do.  Nothing was about finding something they would love to do.  I was really surprised how proud the writer was about this schedule and how the readers all said they longed for the same thing.

But such is the way of the world, I suppose.  Rousseau said, "Man is born free, and everywhere he is in chains."  And too often, I am afraid, the chains are of our own making.

Friday, July 24, 2015

Investment Critics

"The person who says it can't be done should not interrupt the person doing it."
 - Unknown

One of the more enduring criticisms of this blog has concerned the active management of my investments. There has always been no shortage of people telling me I'm a complete idiot for failing to passively index everything. Over the years, I never responded to any of these critiques. In a way, they rather amused me, as I'm nearly certain that I've read far more EMH literature than all my negative commenters combined. I know very well what efficiency is and what it is not. But still, throughout life we always find an unlimited supply of novices that are so eager to shower us with advice.

So as this blog begins to wind down, perhaps I would like to respond just this one time. They say a picture is worth a thousand words. Five year trailing annualized...