Author Archives: Money Reasons

About Money Reasons

A offbeat personal finance blogger that comes from the tech world.

Perils of Big Data or Beyond Big Brother?

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Technology is great!

I’m in the technology field and sometime I feel so empowered!  You can do anything with technology if you work at it, look at all the great smart phone apps that are in existence!  Who doesn’t love reading email or playing Candy Crush any place and at anytime?

But there is a dark, scary underbelly of technology and in particular “Big Data” that you should also be aware of.  And that is, you are being watched just like Big Brother, but much, much more scary!  You see with the much feared concept of “Big Brother is always watching” in the “1984” book by George Orwell, the invasion of privacy required someone on the other end to be watching.  Today is much worse because today, it’s possible to record every thing you do, say and where you go.  You have no privacy whatsoever and it’s stored!

In old days, email trails were something to worry about, then message system like chat, IM and the like.  These days, everything and everywhere you go you are being recorded and potentially analyzed.

No, it’s not a physical person analyzing your data.  Instead there exists sophisticated software and beastly computers that are doing the analysis (this folks is the power of “Big Data”).  Big Brother could and should be considered the algorithms that manipulate the huge databases of information (this is the “Big Data” part) that is being accumulated on you.

HAL

Hall From 2001

For example, Let’s look the iPhone 6, not only is it possible to determine where you have been historically, but it’s also possible to detect the rate speed you were traveling between endpoints.  So let’s say that the government wanted to tap into that rich data and potentially give you a speeding ticket… if they deemed it to be, they could.  Oh it won’t happen because of voters, but it’s entirely within the realm of possibilities.

Now let’s look at the Apple iWatch…  It’s even scarier to an extent.  It has the ability to monitor your body.  While there are obvious positives in doing so, there is also the opportunity for your system to be monitored for odd behavior, maybe elevated heart rate or maybe your alcohol content (via your sweat).  Let’s say that you are at some location like school and your heart rate gets evaluated for any reason, maybe you are running late to some appointment and you are getting nervous.  You could potentially be flagged in some “Big Data” system as a potential sex predator.  Oh you wouldn’t be arrested, but you would now be in the “likely suspect” database or be continuously monitored thereafter.  I’m not saying this is necessarily a bad thing, but it’s still worth knowing about, and knowing that it is possible!

Let’s say you are one of the “Bad Guys” in the world.  Well “Bad Guy” it’s going to get a lot more difficult for you in the future!  As computer, software, cameras, robotics and other specialized hardware become more stronger, cheaper and basically more optimal, you “Bad Guys” will find it much harder to do your “Bad things”.  The Cameras today capture so much more than they use to, and at high-resolution!  Soon, I wouldn’t be surprised if almost anyplace you go has a video system and cities have drones flying overhead recording stuff, not to mention all of the roads with such equipment to capture you car and license plate.  So if you traveling into a new city, or town, you could instantly be flag and tracked.  Again, this isn’t necessarily bad, but good to know..

A side thought is that as the cameras that are part of complex video systems, record you on your smart phones logging into various systems, well you are pretty much flat-out telling the camera owners your password.  Or at least giving the a huge leg up if they decide to try to hack into your programs by guessing your passwords.

There will be a lot of good from technology too, but I just want to mention what is possible as technology continues to advance.  I’m just scratching the surface.  For instance, I could have added a third element which would be predictive analysis, that based on your prior history (see my out of area car example above), Big Brother could predict where you should be at any given time.  Don’t believe me?  Has your credit card company ever called you asking if such and such purchase was made by you in a give location?  This is “Big Brother”-like algorithm detecting that you are out of state making a purchase when you shouldn’t be.  So basically both company and government Big Bothers are here and watching, we just don’t know how “Big” the Big brother are yet, but I will say that the code is from the most part pretty much unlimited in reach…

I’m writing this because article because some people might not realize the reach of the technology and to mention that fact that we are beyond the “Big Brother” version of yesteryear when George Orwell wrote his book.  While it’s not exactly the same, in many ways it is more invasive, in a sneaky hidden way.

Bests,

Don

The Hurdles With Helping Others Financially

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I’m all about experimenting, I guess it’s the scientist in me that keeps trying to break out of my work life that consists of a repeating grind that is way too familiar.

Recently, I decided to try a new financial experiment where I would take an attractive female or male (mostly female because I’m not a good judge of what an attractive male is), and try to teach that person what I know and set them on a course of action that would improve their financial well being. The person that I would teach would have to be willing and have capabilities beyond just good looks, so I’d have to delve a bit deeper than the surface.

So I’ve been on the lookout and came up with an idea where I would even provide the potential person with a small income stream via working for me as a contributing author to my blog. The small income stream was a side effect of another experiment that I will mention at a later date. While not much, I calculated that I would be able to provide about $40 weekly, at least at first. The idea would be that this could balloon up to something much bigger, independent of my involvement.

Most middle-class kids wouldn’t be interested in my proposal, and although I could probably find many potential candidates at local colleges in my area, I decided to hit the bars first.  The idea that a young full-time bartender would not be going to college and probably wouldn’t have the upbringing that a typical middle-class kid would have.  So while not exactly needier, the individual wouldn’t be trained in the same financial principles as the college kids probably had.  And so, that where I come to the crux of this article “The hurdles with helping others financially“.

Hurdle 1.  Approaching Potential Individuals

I decided to approach young females first.  The problem with approaching young females in a bar is that they would think that I’m hitting on them.  So often time the female bartenders are on guard and don’t really trust me, at least in a short time-frame.  If I were to attend a bar for a long time (maybe 1 year), then they might trust me, but until such a relationship exists, it’s would be hard to extend such an offer (especially with very attractive female bartenders).  I have to admit, it’s hard for me to crack this egg, and I’m not a very outgoing person by nature.

Hurdle 2.  Lack of Fun Factor

Part of the experiment would be to teach the individual what I’ve learned and in the short term, provide a very small additional income stream.  The problem is that bartending is probably pretty fun in contrast, so why would they want to try my experiment.  They don’t know what I know, so they might not see much benefit in trying what I would like to try.  I think if you don’t know that there is another way, you might be apt not to try any such suggestions.  I guess what I’m saying is it’s hard to believe when you don’t have the exposure to such a thing.  For all I know, perhaps it’s like believing in Fairy Tales?

Hurdle 3.  Perseverance and Follow-thru

What I would be teaching would require a lot of skills and disciplines that my target might not possess currently.  The individual would have to do all of the following:  Believe that it’s possible, have the perseverance to not cash your accumulated money, and stick to a strict wealth-building routine.  Continue with the program that I would set up for them, even when I wouldn’t be there to offer encouragement.  Perhaps by teaching understanding and coolness towards money, this hurdle might be overcome with some hard work?

The above are some of the main hurdles I would face with this experiment.  I’m sure that I can provide benefit to others, but I might have to reconsider my candidate pool.

In the meantime, I’m running out of bars and bartenders…

More to come hopefully,

Don

The Real Financial Independence Crossover Point

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The crossover point of financial independence isn’t where you’ve been told.  Let me explain…

You see the crossover point where you are now considered financially independent and work is optional isn’t really the point that you think it is, instead it is just another financial milestone on the journey to financial independence…

The real crossover point of financial independence is much higher that point where your income equals your expenses.  So let’s say that you calculate that you need an even million for financial independence.  So if you have one million, and it was investing in such a way that it could provide you with a 5% yield (via a combination of bonds, stock dividends, real estate, etc), that would provide and income stream of about $50,000 a year.  For some of you 50k a year might not seem like a lot, but financial independence isn’t about a luxurious lifestyle, it’s basically the point where you can stop depending on earned income (your job) to survive at your current lifestyle.  So while 50k might not seem like enough, it’s past the point where you have to depend on a job to survive (at least most of us).

BusyOfficeMan

So why isn’t this the end of the story?

Because of market volatility and other unpredictable variables could move your “financial independence” point below what it is currently.  For example, let’s say that you have stock in a stalwart company you thought was rock solid, but it was ended up having some kinks in it’s armor, so that suddenly, the stock price decreases in value by 50% or even more, and as a result, it axes it’s dividend entirely.  Well, that puts you in a bind because suddenly you could have an income stream that is much lower than the 50k you thought you would have.

So what is a closer representation of my “financial independence “point?

Well, while there is no set in stone answer, I’m personally shooting for a number that is 50% higher than my “old” financial independence number.  So instead of 50k, I’m shooting for income stream of $75,000.  So for hypothetical nest egg amount, instead of 1 million,  I should shoot for 1.5 million, but since there is also taxes to consider I actually bumped my number up to cool 2 million dollar.

The point of this post is that you should overshoot your mathematical “financial independence” point just to have a cushion for variables that are not currently predictable.

Bests,

Don

 

 

Pulling The Family Sled

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In my family, I pull the financial sled alone.

As I watch my friends become rich along with their working wife, husband or significant others, I can’t help look at them with a quiet envy as I pull the family sled alone.  I feel alienated, and slowly over years I avoid more fortunate friends as I find myself succumbing to my embarrassing, hidden envy.  They talk about retirement at an age that I will not be able to match, because as they and their companion,  both pull the sled, at my home, it’s just me.  They talk about their great partnership and the enjoyment of life with their significant other as I continue to pull and pull.

 

I pull the sled day and night, working late developing and refining financial family plans, trying to find a better grip as I pull the financial family sled along, alone.  The sled gets heavier each year with my daughter jumping in the back, my son ignoring my pleas because he has his headphones on (even when they are not on his head) and my wife laying on the couch or bed, always watching TV.  My wife has no time to help me, so I pull by working one, two and sometimes three jobs to keep the sled moving..

When I’m sick, I still pull the sled, the sled is heaviest then, but still I struggle on.  Now I’m sick and getting sicker, but I still pull the sled alone.  What happens when my time is up?  Who will pull the sled then?  Maybe I pulled the sled far enough that they will be okay?  Hard to say, have I pulled far enough that the pieces are in place for at least a survivable life for them?

Some days, when I’m alone and I’m isolated and in a dark place, I wonder what would happen if I stopped pulling the sled and just let things go.  Thoughts, so many thoughts but for now I just pull the sled alone.

-Chase