finances – Christopher Wink

The Changing World Order: Why Nations Succeed or Fail

Empires rise and fall in predictable ways that follow long-established patterns.

An emerging power invests heavily in education, infrastructure and trade to create wealth, which it protects by strengthening its military. Elsewhere the current leading power grows decadent with rising wealth inequality, in-fighting and fading investments until the emerging power confronts it – and wins. War and revolution start the cycle anew.

That’s among the biggest themes from the high profile 2020 book from Ray Dalio, the founder of one of the world’s largest hedge funds: Principles For Dealing With The Changing World Order Why Nations Succeed And Fail. It’s part of the “principles” series that includes extensive independent research that Dalio’s team maintains here. He intends to look at the longest historical period possible to find patterns that can inform what happens next.

Most pressingly, he argues we’re at the late stage of the American empire, when the United States will continue to decline from its role as the world’s global hegemony and cede that position to China. I’ve been disappointed that much of his coverage has not challenged him on what seems a very big conflict of interest: Dalio is heavily invested in China, an authoritarian country that does not protect criticism, and he has been careful to avoid criticizing the party. In short, the book’s biggest flaws may be that he pulls his punches against China. Still, by using his own determinants and data, he paints a stark picture of unassailable patterns over the last 500 years up until today that looks like this:

Below I share my notes from reading the book for my future reference.

Personal finance is a social justice issue

The so-called K-shaped recovery to the pandemic economy is expected to widen inequality. It was already well-known that it is expensive to be poor. Yet we sometimes think of personal finance as the hobby of the already rich — of a white male dalliance.

Since the Great Recession and the lost generation of Millennials, there has been renewed interest in accessible financial advice. Yet even as white Millennials are finally making financial gains, it seems Black Millennials are still falling behind. For years at my company, I’ve tried to strike a balance between being positively encouraging to my team to increase their retirement savings (and to speak to the financial planner we make available to staff) without becoming too overbearing. We’ve made gains but I find the topic daunting.

Perhaps because the pandemic cancelled my annual Personal Finance Day with friends, I’ve been thinking a lot about a passion of mine: Personal finance is a social justice issue.

This is important because so many savings and investment fundamentals are simply not intuitive. Get rich schemes continue to fool many. In contrast, slowly and patiently putting a little bit aside into a passive index fund has been a remarkably reliable method for building wealth. Even God couldn’t beat dollar cost averaging.

Talk openly with your friends about what you earn, what you save and how you develop on your own journey. The internet is full of bad advice, but it’s also home to so much good stuff too. How to decide what is what? A solid rule: look toward the longterm and be committed by building habits.

(Photo of the calculator app by Kelly Sikkema via Unsplash)

A few quick personal finance lessons from Morgan Housel’s ‘Psychology of Money’

Finance is no science. It involves the tiny actions and feelings of millions of people.

Finance writer Morgan Housel published a tidy book last year called the Psychology of Money that does a fine job communicating the concept. I quite liked it, so I’ve shared a few quick takeaways I got from the book. Consider buying your own copy.

Here’s a 2018 blog post he wrote honing the topic.

Your retirement savings goal to strive for should mean you never dip into principal

Americans are rotten at saving for retirement.

It’s at least in part because of the seismic market change from 20th century-era defined benefit offerings (the pension you might have gotten working at a company in 1972) to today’s climate of defined contribution plans (the 401k you have at work or the IRA you might have with a company like Vanguard). More recently the Great Recession complicated the story more.

Whatever the case, we know one in three Americans has less than $5,000 in retirement savings. Two-thirds of Americans say they’ll outlive what they have saved, including the half of households that have no retirement-specific savings at all. Rules of thumb to the contrary abound: you ought to have the equivalent of a year’s salary by the time you turn 30, and you might want at least 10 times your top earning salary saved by the time you do retire.

When things are stressful, I tend to try to find some way to make them more approachable.

It’s in part why for the last several years, two childhood friends and I have gotten together once a year to discuss what we’ve tried, learned and accomplished on the subject the previous year. With a bit of nerdy glee, we call it Personal Finance Day, and we just held the fourth annual earlier this month.

Continue reading Your retirement savings goal to strive for should mean you never dip into principal

There’s no such thing as a safe investment worth making: ‘Personal Finance Day’ notes

I’ve shared before what a strange nerd I am. I tackle learning in a full-force kind of way, and I love to pair seeing old friends with new experiences and ideas.

For the third year, two childhood friends and I came together Saturday for dinner and drinks and elaborate slide presentations sharing lessons we had learned about the difficult and tricky and complex world of business and retirement planning and, yes, wealth creation.

Indeed, it was the third annual Personal Finance Day.

I wanted to share a few things we talked about that might transfer well. And use this as a reminder: when something as stressful and arcane as personal finance intimidates you, find friends, make whiskey sours and dive in and discuss. You’ll be surprised how much fun you can have.

Continue reading There’s no such thing as a safe investment worth making: ‘Personal Finance Day’ notes

What I learned at our second annual ‘Personal Finance Day’

Following up on last year’s inaugural, two friends and I returned to the rural county we grew up in together and had a day-long nerd out on personal finances.

Yes, after cocktails and dinner and catching up, we literally gave presentations and shared tips on things we were learning about navigating the very complicated personal finance world. It’s all about fun and self-improvement.

We shared and discussed and debated over ideas and rules of thumb and data — like the above pictured Zillow chart predicting longterm real estate growth in my neighborhood of Fishtown.

Below, I share a few notes that aren’t top secret.

Continue reading What I learned at our second annual ‘Personal Finance Day’

Getting married? here’s some advice on handling joint finances

More than a year ago, I got married. It’s fun and challenging and rewarding. I’ve learned a ton — even before the big day. One of the great challenges of any marriage is how two people merge their finances.

I wanted to share some of what I’ve learned over the last two years.

Continue reading Getting married? here’s some advice on handling joint finances

A few things I learned at a ‘Personal Finance Day’

The act of learning something I can use has maybe always been one of my favorite acts (that’s why I used to collect extra printouts from school printers). And the mysteries and vagaries of finance have perhaps intimidated me more than most — particularly as a business reporter.

It’s a system that benefits from its complication, making it easier to separate us from money. So I try to take as many opportunities as I can to learn and share to pick up and trade tips on personal finance. As a middle class kid, I had the privilege of being introduced to basic banking from an early age but the more complex instruments were ones I discovered as I pursued greater understanding through high school and college.

I’ve continued that learning and want to share some recent lessons here.

Continue reading A few things I learned at a ‘Personal Finance Day’

Here’s the final math on my middle class $100k college education

I have now fully paid the $100,000 that my college experience from Temple University cost. Here I share the breakdown of some more specifics on what those costs include and how I paid them.

This month, six years after graduating from Temple, I will put $1,800 to close out the last of my student loans. As many of my peers, who attended ‘out-of-state’ universities and are from, relatively speaking, privileged, middle class families will tell you, I accelerated this process considerably. I don’t like debt, so each year since 2010 when I was able to do so, I paid more than I was required to in order to speed the process of getting debt free.

Continue reading Here’s the final math on my middle class $100k college education