2010 Preliminary Money Thoughts

I thought I had only really identified a couple of concrete money goals for 2010, but it turns out I have more than just a couple.

They are (in no particular, but somewhat organized, order):

• Take my emergency fund to $20,000.  Should be approximately 13 months worth of living expenses, which should be fairly comfortable for me.  This is less ambitious of a jump than last year, and should free up some cash each month for...
  
• Take my checking account from its normal hovering-around-$300 to hovering-around-$2,000.  I lived for the last year with a low checking account to create a feeling of scarcity.  This kept me from going wild buying tons of stuff, but also led to some unneeded stress, which may have even interfered with my social life/attitudes.  Having a larger operating margin should help with...
  
• Take outstanding balances on my credit card to 0, always.  No more finance charges, no more worrying about paying, etc.  Paying with a credit card should be done for online transactions (or others where I'd like the protection of verifying the transaction before the money disappears), automated transactions, and earning points, nothing else.  Paying it off should happen within days of the transaction.
• Carry cash more often.  I went through various periods where I would carry cash.  One method that worked for a time was to start the week with $100 in my wallet.  I could spend where I wanted, but couldn't overspend, and each week I would only withdraw enough to take it back to $100.  Seems like a good idea to have some cash on hand, and it makes splitting a check, etc. a lot easier.
• Generate an alternate stream of income.  I have some ideas on this, but those will be for future posts.
  
• Open an IRA (either with pay from my severance package, or from rolling my old employer's 401(k) into it).

What are your 2010 money goals?

2009 Resolutions, Revisited

On a lark (well, it was probably actually a good idea), I went back and checked out my 2009 New Year's Resolutions.  What an interesting set of resolutions - let's see how I fared.


1. Develop myself into a more rounded person: spiritually, socially, and in general, as a human being.
Intended to be for getting involved with community, social events, etc.  I attended and hosted several "impromptu gatherings" with coworkers, and got in better touch with an old friend from high school.  Didn't do so hot on the spiritual side, but I did try to activate my civic side by attending a few neighborhood association meetings and a "crime walk" in the old neighborhood.  Definitely want to get involved in my new community this year.

2. Excel at work: be a model worker, be innovative, create and add value, and be a leader.
I did fairly well at work this year - leading the successful release of a new product (post about the beginning stages) - and consistently received a 5 out of 5 (i.e. "distinguished performance") rating in our half-year reviews.  I conducted training for several groups throughout the company, wrote requisitions and proposals, rearchitected various solutions, created interfaces, made data more accessible to people, the list goes on...

3. Do well in school: prepare for class, learn, study, and be a leader in and out of class.
Not sure if I was "prepared" per se all the time, but I did manage to complete 6 out of 6 classes with an A - and worked my butt off in the summer with class 3 nights a week for a while (hence the like, 3 blog posts in the summer).  I did most of my readings ahead of time, learned quite a bit from some of my classes, and even helped lead some successful group projects.  One of my other ideas of success in school is asking pointed questions of the professor - the kind that make the professor say "that's a great question," or, "hm, I never thought of that."  I did manage to get a few of those in here and there.

4. Play by the rules: do things the right way instead of the easy way.
Not sure if I can quantify this at all, but I did try to do things the "right" way - mostly administrative stuff like taking care of my car, registration, etc.  It was not without some failures along the way, like getting a ticket for not having an emissions inspection done - the notices never reached me even though I had set up a mail forwarding with the post office.  As soon as I knew the issue, I did my time at the DMV (3 hours) and emissions inspection place, getting the inspection done, the flag lifted, and a change of address card.

5. Maintain a healthy lifestyle - including diet and exercise.
I'd grade myself around a B- on this - I'm still at the same weight (or a bit less) than I was after my big weight loss, but it's not quite as toned/muscular anymore (damn!).  I didn't hit the marathon goal, as planned, nor was I a stickler about what I ate.  I just seem to have found an equilibrium where I don't really gain or lose weight, and can still enjoy going out, the occasional bag of chips, etc.

6. Position myself well, financially.
I posted earlier about hitting one of my 2009 goals - getting my emergency fund to $12,000.  So that was huge.  In addition, I've started up several other accounts - car maintenance (currently near $1000), electronics insurance (near $150), Europe trip (near $600).  I've automated quite a few things with my finances, reduced a lot of frivolous spending (although food spending is still a little high), and have generally lived with a "scarce" checking account. It might introduce a little unnecessary stress of "oh-crap-do-I-have-enough," but it definitely kept me aware of my finances all year long.

7. Don't tolerate selfishness or inconsideration from anyone, unless for reasons concerning my own well-being.
Another hard-to-quantify one.  Um...I think I did this?  I think I just tried to avoid people and situations that would qualify for this, so at least I never had to "not tolerate" it verbally.  Maybe I was just too busy with class and other things.  Can't think of any good examples, but I know I was definitely less frustrated over this in 2009 than in 2008.



8. Attract positive influences into my life.
Also hard to quantify, but I don't think I really did this (unfortunately).  Something to work on for next year, perhaps?

Overall Grade: B.  Could have been better, could have been a whole lot worse.  I'm reasonably satisfied with what I accomplished, although I would have loved to have more time for me, instead of work and school taking most of it.

How did your 2009 resolutions go?

The End of an Era

It all started with rumors of a voluntary separation program.  My company was exploring ways of gaining massive efficiency, and one idea was restructuring, downsizing, and a return to its "more nimble" roots.

Fast forward a few days, fade in on team meeting.  Boss's voice-over as camera pans around the room with bored, tired, and slightly perturbed faces: "I think it's a testament to the great work this team does, and in finding our new place within the new company structure, the team will be officially disbanded."  That's right.  The crack-squad team that influences 80% of the company's revenue, and brings rapid prototype solutions to market quickly to help bring in additional revenue, was being broken up.  It was worse than (insert-your-favorite-band-breakup-here).

Fast forward a few more days: the voluntary program is officially announced.  1/3rd of the company needed to go, and they were asking as many people as possible to volunteer.  Those who did would receive at 3 month severance package, those who were involuntarily laid off later would only receive one-month.

Endless gossip, conversation, heart-to-hearts, etc. led me to my conclusion.  Based on the amount of compensation (and the other benefits thrown in as part of the severance), and being a young, talented engineer, my chances were best on the open market.  It had been a great two years, but it was time to find a new challenge.  And everyone I talked to said I wasn't burning any bridges by leaving, if I needed a recommendation, or a job in 3 months when the dust settled, I should hit them up any time.

I made my decision, signed up for the voluntary separation, and away we go.  I had an 11th-hour talk with another manager, who tried his best to incentivize me to stay, and tried his best to get in touch with HR to get it in writing, but alas, no avail.

It's okay.  The hardest part of my decision was leaving the people behind - but I know there are other great people out there, and I know that a "good-bye" here is really just "see you later."

For now - it's resumes, cover letters, and a frantic job search.

Apple Wired Full-Size Keyboard Review

I just picked up the Apple Keyboard with Numeric Keypad this weekend ($49.99 before tax), and here I sit composing a blog entry with it!  I'm often up late at night working while GF is sleeping, or I'll get "in the zone" while programming and not realize how loud I'm typing.  I figured it was time to do something about that.

Pros:

• Form factor: the keyboard is slim.  It stands about half an inch high at its highest point, compared to my old Dell keyboard at nearly 2 inches.
• Appearance: Apple obviously has this down.  The aluminum casing and white keys just looks slick.  Now if only they had backlit keys like they do for their laptops...
• Keyfeel/sound: definitely quiet - it was hard to hear anything at all in the loud Apple store, but even at home, these keys are quiet.  I'm a fan of the chiclet-style/laptop-style keyboards, and I like the short travel distance.
• Works with Windows: just plug-and-play.  It turns out that the "apple" key maps to the "windows" key on Windows keyboards, so I don't even lose any functionality.

Cons:

• Space bar: the loudest of all the keys by far is the space bar.  It gets a little bit annoying that everything is so quiet, but just punctuated by the space bar.
• Layout: on my old keyboard, from bottom left to right, the keys were CTRL, WINDOWS, ALT, SPACE.  On this one, it's CTRL, ALT, APPLE, SPACE.  Throws off my alt-tab window switching, but I'll get used to it.
• Color: I read some reviews that said that the white keys do eventually get dirty, which is a little sad.  As of now, I'm just making sure to wash my hands every time before using the keyboard.  We'll see how long that lasts.

Overall, would recommend it (based on my 24 hours of possession).  The good keyfeel and quiet strokes are absolute musts, and as I use it more I'll get to try it out for various tasks - blogging, IMing, programming, etc.  Another win for Apple.

My Biggest Milestone (so far)!!!

Everyone, I have an announcement to make. 

I not only hit (and exceeded) my "Realistic" savings goal, I hit 80% of my "Ideal" goal (see goal trackers at the right)!!!

As with many things in life, industry, programming, etc., I'll take an 80% solution today over a 100% solution at some unspecified time in the future.

At $12,000, my emergency fund is finally built up to a solid enough cushion that I feel like I can work towards a few other goals (hence why I need to set my goals for 2010!).  My current estimates make it about an 8 month reserve, and I plan to keep siphoning money into it for the near future.

It was a tough journey, including some "harrowing" moments of low checking account balances and feeling like a tightwad on occasion, but it was all worth it in retrospect.

December Goals, update

Just a quick update to the December goals -

• Got my two A's in class
• Figured out I'm not doing anything for the new year
• Hosted two separate events - one for Chanukah, one for celebrating the end of an era

Still need to:

• Make eye doctor and dentist appointments
• Make 2010 goals

How is your December coming?

December Goals

The quick list:

• Establish my 2010 goals in 4 areas:
• Financial
• Personal
• Professional
• Academic
• Finish the semester with two A's
• Investigate triathlon training
• Make a dentist and eye doctor appointment
• Figure out new year's plans
• Host friends/coworkers for an impromptu gathering
  

Simple, really.

101 Things in 1001 Days Update, Pt. 2

So I just went through and updated my 101 Things in 1001 Days post, so I figured I'd write a few words about what I've accomplished...

1. Establish a 12 month emergency fund - my emergency fund has grown to $11,500, which at my figured rate of $1500/month comes out to 7.67 months.  So, I'm not quite all the way there, but definitely some significant progress since my last update.

14. Go a week without caffeine - a couple months ago, I noticed that my heart rate was skyrocketing, I was always nervous, and wasn't sleeping very well, and I realized I was drinking 3 cups of coffee in the AM, 2-20 oz. bottle of soda in the afternoon, and a cup of coffee or tea in the evening.  I went cold turkey, and essentially avoided all caffeine, choosing water over coffee, and Sprite over Diet Coke or anything else.  It was a marked difference - the first couple days were a little rough as my routine and habits were broken, but by the end of the week, I knew I could go without caffeine if I needed.  Since then, I've brought a little tea and soda back into my life, but not in such a high quantity.

19. Take vitamins every day for a month - we bought gummy vitamins at WalMart a couple months ago.  They make it real easy to take your vitamins, 'nuff said.

27. Learn to drive stick shift - I had a chance to visit my friend in California in September, where we reviewed my (basic, underutilized) stick skills, and then took a drive around the hills of Oakland.  I even got to learn the e-brake technique for not stalling on hills (for noobs like me).

77.  Begin, and potentially finish, a master's degree - I started my master's degree in computer science and am now 60% done. I've taken Foundations of Software Engineering, Foundations of Computer Architecture, Foundations of Algorithms, Artificial Intelligence, Computer Graphics, and Data Visualization.  Up next for next semester is Queuing Theory and Advanced Computer Graphics.

83.  Check tire pressure once a month - I've been checking my tire pressure fairly regularly, though probably not as often as I would have liked.  I definitely need to double check one of my tires, because I think I ran over something that may have gotten lodged inside it.

86.  Go sailing - I got to go sailing with a friend on his new sailboat out in the harbor.  It was a nice day, light breeze, and we got up to about 4.5 knots.

97. Discover 5 non-chain restaurants - I've discovered 2 that I can think of; one is a great burger place where you can build a burger (I go with bison burger, avocado, cheddar, salsa, and hot mayo), as well as get waffle fry nachos (SO GOOD!).  The other place is a soon-to-be-opened Mexican joint (or rather, bistro), that I was lucky enough to get on the guest list for a menu preview event.  Great stuff!

Added Value, Value Added

I've been thinking about these concepts quite a bit recently, inspired partly by my company's interest in "Value Added", and partly by my recent reading of Cal Newport's blog about productivity and study hacks.

A couple notes before we begin (from Wikipedia):

Added Value

• Added Value = Sales - Purchases - Labor Costs - Capital Costs

Typically used in share analysis by investors, added value is the difference between the product's inputs and its output selling price. Taken as a whole, it should be the total profit of a particular company

Value Added

• Economic Value Added = Net Operating Profit After Taxes - Weighted Average Cost of Capital x Capital Employed
• Market Value Added = Value of the Firm - Capital Invested in the Firm

Opportunity Cost

• The value of the next-best choice among several mutually exclusive options

Value Added (at my company)
Traditionally opportunity cost is thought of in terms of buying something.  By investing $10,000 instead of putting it in the bank, my opportunity cost is the value of the interest I could have generated at the bank.  If my investment pays off, my opportunity cost is essentially irrelevant.  If my investment tanks, my opportunity cost is interest -  money lost in investment.

On the other side of the coin, opportunity cost can be thought of on the revenue side.  For instance, consider a contractor who can work on two potential projects - one for $100,000 and one for $80,000.  His opportunity cost is the value of his "next best option," i.e. $80,000.  The value-added of his best-choice option is $100,000 - $80,000 = $20,000.  If that option weren't there, he'd be "costing" himself $20,000.

How does this apply to me?
I've been thinking about this in terms of its application to time management and/or productivity.  Consider: I have 3 hours this evening, and I need to decide what to do with it.  I can goof off, watch TV, do homework, work on a business idea, work on this blog - and each one has its associated value.  The question becomes, at any given point, what is the value-added by the particular action that I'm taking? 

Sometimes vegging out has the highest value-added; you just need a break from it all, and clearing your head, de-stressing/de-compressing is the best way. Other times the highest value-added activity is doing homework, or exercising, or something else.  So it's not just about the raw value of the activity, but about the opportunity cost of not doing it.  I could forego working on homework in favor of working on business ideas, at the cost of having to do it later, not doing as good of a job, etc.  I could also forego working on business ideas in favor of homework, at the cost of less future revenue, delays in starting, etc.

The key here though is that I can probably accomplish about the same amount by doing my homework now and working on business ideas on the weekend.  The net present value of doing the homework and the cost of the procrastination outweighs the value of entrepreneurship right now and provides a higher value added.

Kind of complex to think about it all laid out like that, but the mere act of asking the question "what is the value added of what I'm doing right now," is enough to sharpen one's focus and make sure you are concentrating on what's important.