Just Five Goals

Like most folks', I imagine, my goals were a bit hit or miss in 2013. I won't run through them all, but let's just say that some I missed by a bit, some I missed by a lot, and some I simply ignored. I fell prey to the normal problems: not making my goals public, not checking in on status regularly, and setting negative goals instead of positive goals. Stepping back a bit though, I can see that part of the problem is that there were just too many goals. So this year, starting anew like so many others this January, I decided to whittle my goals down to just a list of five.

The Irrationality of Fantasy Football

This past Sunday, instead of thinking about the birth of our Lord and Savior as I should have been, or even thinking about all the cool presents I would be getting later in the week, I was instead obsessed with half a dozen real football players collected on my not-real fantasy football team. Worse yet, I wasn't even concerned with how these half dozen players fared in the real games. I couldn't care less whether they won or lost. All I cared about was their stat lines: how many yards they ran, caught, or threw for. (For those who are luckily unfamiliar with the game, here is a primer.) If my fantasy team won, I'd go to the championship game next week and I'd be in the money. Both first and second place get paid ($500 for first, $100 for second). But if I lost, I'd play for a meaningless third place game that paid butkus.

Use Value and Exchange Value

These days, we are in a constant state of trying to get rid of things. I have too much crap. Our method, imperfect as it is, is to try to rid ourselves of one thing a day, thirty things per month. Most of the items are small and just get donated. But when an item we own actually turns out to be worth money (this is rarer than it should be), we have to decide whether to keep it or try to make some cash in a sale. This makes for some interesting decisions, as the ongoing process of selling and donating things requires a tricky first step: deciding how to value an item. Luckily, Adam Smith has given us two concepts that help make that decision easier: Use Value and Exchange Value.

A Case for Outsourcing

Like a lot of personal finance junkies, I am a big fan of Mr. Money Mustache. Latecomer that I am, he was the first blogger I found who was writing about early retirement through frugality. And one of my favorite early posts of his was on the subject of outsourcing housework and, more broadly, about outsourcing in general. The MMM approach is to "insource" everything: domestic chores, home improvement, car repairs...do everything yourself. His argument for insourcing states that, regardless of your hourly wage, you cannot work any job or freelance activity for all waking hours: you would burn out. The breaks taken to clean your house, maintain your property, cook your own food, and wash your own dishes provide variety, prevent burnout, and save money. In addition, insourcing larger tasks, like home improvement, builds your base of skills. What's not to love?

But is the approach to "insource everything" truly possible, or optimal?

One Case of Homelessness

By now you've probably seen Tom Corley's list of twenty habits of the rich, compared to those of the poor. Corley studied 233 wealthy people and 128 poor people, and surveyed their habits over a period of five years. The list outlines the behavioral differences between the rich (67% of whom exercise aerobically 4 times a week, for example) and the poor (only 3% of whom make their children volunteer for 10 hours a month or more).

It's not great when I let someone else's writing bother me, but for some reason this list did. It's likely my politics getting in the way again. I've also heard some defenses of Corley's research, claiming he is simply talking about correlation and not causation. And that's a reasonable defense. But I also know that the author's point was not to list a series of interesting correlations, but then immediately caution readers that no one should infer that those actions had bearing on those people becoming wealthy or poor. The author's desired conclusion was not for readers to think, "Hey, that's interesting - but clearly we should not conclude that poor people might improve their lot if they changed their habits." In fact, it was the opposite. As Corley states in his interview with Dave Ramsey, "If you have good daily success habits, or 'rich habits'...you are going to be successful; if you have more poverty habits then rich habits, you are going to be poor. It's really not that complicated." That's a clear argument for causation.

Why I Cannot Watch Extreme Cheapskates

I am late to the game, but I recently saw my first episode of Extreme Cheapskates. The show broadcasts on TLC and documents the day to day lives of extremely frugal people. Like all TLC shows, the allure is that by showing people who are very different, viewers get to feel very normal.

I try to be a positive person when I get an insight into other people's lives. I want to be sensitive -- I'll do me, and you do you. But there is something about this show that makes me cringe. Watching the extent to which the show's subjects go to save a few pennies is, somehow, almost impossible for me to sit through. Which makes no sense because, even if these people go farther than I do, shouldn't it be refreshing to see one program out there that showcases the merits of frugality rather than the typical life of excess? But when I watched my first episode, which followed around Jeff Yeager for a couple days, I could barely make it to the end.

Notes from Peru & Ecuador...With Pictures!

Good afternoon, readers. Things are easing back into a routine now that I am back in the states. Though I did get some bad news yesterday, as H.R. states that my request to work in Peru for three months violates some US tax and payroll laws. It seems working for a US entity while actually working abroad is not permitted. I am in no position to dispute this, but if anyone out there has experience (or even knows of someone) who has worked abroad while still working for a US company, please send me an email. It might be a long shot, but I'm hoping to draw on the awesome network of readers to get to see my wife next year. If not, it looks like we'll be apart for a while longer.