Hello Vancouver! Briefly!

A quick note, to any Vancouverites that may be interested, that I will be in town on Wednesday to speak at the FIRST 2008 conference. The title of the talk is “The Most Important Thing – How Mozilla Does Security, and What You Can Steal.” If you’re attending the conference, I hope I’ll see you there. Once the conference is over, I’ll post my slides and a video of a presentation dry-run, in case anyone is interested.

I had a lot of help from several people, most notably Shaver, in putting this presentation together; my goal is to keep adapting it and ideally get other people giving it as well. Security is something that the Mozilla project has a lot of experience with, and a lot to be proud of. It is important to our mission that we share that expertise. Even when what we’re saying isn’t new (“have unit tests”), the fact that we have achieved the success we have lets us be a proof point for people trying to make change in their own projects (“Mozilla didn’t think code review was too time-intensive.”)

I may not be an official member of the evangelism team, but I will do whatever I can to encourage more people in our community to take their knowledge outbound. We are doing crazy awesome stuff here (how many IT people, on the planet, have dealt with what Justin‘s team has?) and we should consider it an obligation to spread that knowledge around. Heck, that’s actually sort of what my talk is about.

Critical Thinking Moment

Everyone has seen the commercial where the progressive insurance guy tells you that people switching to progressive saved an average of $332 on their car insurance. Except that you see similar commercials from State Farm, Geico (albeit with a more fetching mascot) and probably several others.  How can this be?  Who really offers the lowest rates?

The fact is that none of these commercials tell you a damned thing about which insurance company will offer you the lowest rates. What they tell you, all they tell you, with remarkable consistency, is that it takes an average savings of $300 to get people to switch insurance companies.

They keep running these ads because they count on the public not to know math.  I’ve no doubt that this is a successful campaign for them too.  Hug a math teacher today.

Mathematiques Roadshow

Antique Drawer knobI don’t think it’s very normal of me, at the tender young age of 28, to enjoy the Antiques Roadshow as much as I do. I tend to explain that I like it for very much the same reasons that I like books like Salt; namely, that in the examination of the most arbitrary of things, you can reveal the history of the whole damned world. Me being me, of course, a not-insignificant contribution to my enjoyment is made by the people-watching aspect of it.  People are shy or proud or hopeful or confused about the things they bring in, but they are always invested, and that gives the show some (albeit subtle) dramatic tension that predates reality TV.

There is an undercurrent of innumeracy in the show, though, that I find distracting. In the end it’s not enough to wean me – if people are happy in their numerical misunderstanding, so be it; I would hope never to be the one subtracting happiness from the world. But it creates a sort of dissonance for me when I’m watching, to know that their notions of appreciation, even the appraisers and experts, is sort of… out of whack.

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No Money Down

Mortgages[This really isn’t an article for one person, but there’s one person out there who will think it is about her, and in a way it is – if she weren’t talking about this then maybe I wouldn’t be thinking about it and writing about it just this very second. Nothing in here is specific to her situation though, and with money it’s almost always about the specifics of your situation, so grains of salt all round.]

So you want to buy a house. Great. I’ve already written about that. Basically I think it’s a good idea. Certainly in the long run it’s a good idea for most people – it’s a forced savings vehicle that tends to beat inflation, and it’s also a roof and a fridge and faucets and other things that make life more comfortable. Yay houses. One of the things I glossed over in that article, though, is the question of downpayments, or more specifically their absence: no money down mortgages. You all know that I am not someone to let glossings-over stand.

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So You Want to Buy a House

Mortgage Application

With RRSP season out of the way for the time being, and with all my money spent on the recent cruise it seemed somehow fitting to talk about things I have already spent my money on for a while. Since buying a house was, at the time (before the wedding), the single largest and most complex financial undertaking we had gone through, I can relate to the fact that some people find the prospect daunting. Honestly, I think it could stand to be a little more daunting, and that there are people buying houses out there that really shouldn’t be, but that’s exactly the kind of talk you’d expect from a guy who’s already on the in-list, and is just trying to keep out the riffraff. I don’t know why you people keep reading, honestly.

Buying a house is much more complicated if you aren’t rich. And the less rich you are, the more complicated it gets, so the first piece of advice is that if you can be rich before you buy, it will really help you out, and you should totally do that first. Even if you aren’t rich though, the process is straightforward enough and can be really happy-making if:

  1. You can actually afford it
  2. You build a good team
  3. You keep some perspective

Don’t DO NOT Don’t buy a house until you’re okay with each of those. Let’s talk about them in turn.

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RRSP Implementation

So okay, you’ve got RRSPs basically figured out. The problem is that even once you understand that an RRSP is basically just a license to invest in whatever without paying taxes (at least, for now) there’s still a bunch of mystery there. It’s a very jargon-dense environment, and for someone who finds the whole topic sort of foreign, a “developing markets small cap hedge fund” is a great big barrier to entry. Besides which, you don’t know how you’re going to find any money to put into one of these things, or how much would be enough anyhow. In a way, you’re worse off for having read my last post (sorry about that) because now you get how simple things ought to be, and you’re STILL out in the cold.

In this post, which comes hot on the heels of the last one only because of the near-expiry of this year’s RRSP deadline and because I like you, I’ll try to give you some suggestions. But you have to promise you won’t sue me, because I might-just-might make actual recommendations, and they might not be right for you, so this is the part where you really have to make your own call.
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RRSP First Principles

[I am, if not my worst critic, at least my most diligent, and so I am now quite convinced that my last missive on the subject of personal finance was sorely over-ambitious. There was enough there for at least 4 posts, and I crammed it all in. Instead, I’m going to try to lay this stuff out more smoothly, because I really do think it’s important. Let me know whether I’m making more sense.]

Cutesy giggles about not wanting to grow up notwithstanding, when you leave school and start working full time, I believe you reach a point where you can be reasonably expected to take some ownership over your life. Paying your own bills, washing your own laundry, these are the things that distinguish us from lemurs. There are, of course, plenty of good reasons to temporarily take a pass on these: people living with their parents to help save up for a downpayment are being relatively grown up about their lives, for example, even if they aren’t paying their own bills just yet. But in general, we expect people to sort of become adults. The problem with this expectation is that unlike driving, or parenting, or trigonometry, there is not a coherent attempt during most kids’ lives to teach them anything about money, and since the same was largely true of our parents’ generation (perhaps moreso), a lot of people get to be adults without knowing much about how to manage their money or how to save for the future. The problem is that this uncertainty evolves into embarassment, which becomes denial and refusal to do anything about it, and that’s no good because eventually someone has to pay the bills, and this thing where we just hike the Canada Pension Plan premiums by 5-10% every year isn’t going to keep working.

What I’m going to try to do here is just talk through the idea of an RRSP, in the hopes that you’ll at least come out the other side confident that you know what an RRSP is, so that you can start thinking about how you’re going to go about building one. There is good discussion to be had about the relative merits of RRSPs vs. other investment possibilities, but none of that can happen until we are working with some shared understanding about the ground rules, so don’t sweat that. As I mentioned above, I’m also not going to try to offer advice on which products to choose here, since it takes us back down the road of a post too long for any mortal to read. So here we go…

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How I Learned to Stop Worrying and Love the Market

Maybe it’s the Chianti talking, but I’ve got something to say about investing: get your plan sorted out because I have exactly zero interest in paying for your retirement. Every day you decide not to bother, or say you’ll think about that in a few years, or complain that other things are more pressing, is a day you’re leeching off my taxes, my CPP, my hard work.

And the worst part is: it’s not hard to be smarter than almost everyone. You can sit down in an hour and get yourself set up to do better than top-dollar money managers.

All you have to do, and it’s a tough pill, is get used to the idea that it’s not very exciting you don’t get to brag about it.

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Guilt Free Money

I tend to obsess. Not in the melodramatic sense of the word; I don’t obsess about my thighs or about my complexion or about whether Tommy Jenkins will ask me to the winter box social. What I mean to say is that when I decide to find a topic interesting, I

a) see it everywhere
b) feel compelled to purchase (and read) books about it
c) seek out communities of thoughtful and intelligent experts in the field, and read everything they have said to each other in the last year or so on the subject
d) read the new books I have discovered
e) think a great deal about it
f) Tell Amy all about it. ALL about it. Even when she’s sleeping, or eating, or hitting me. She usually just rolls her eyes.

This is a system which, at least as I apply it, is really quite adapted to developing my expertise to a relatively competent level in a relatively short time over a relatively broad expanse of possible interests. I have applied it with success in automotive mechanics, birds of eastern North America, understanding electricity for real, and poker, as examples. I have also applied it quite vigorously on the subject of finance. Budgeting, insurance, credit and debt management, mortgages, retirement planning, real estate investment, taxation, equity trading, mutual funds, options strategies, &c. &c. I do not offer for-profit counselling services nor would I without some kind of accreditation to back me up, but I am also relatively comfortable with what I know and what I don’t, enough that I can make judgements on the wisdom of various ideas or strategies and be confident in the decisions I make.

Enough that I can yell at my monitor when I read what passes for “financial strategies,” “money management” and <shudder> “budget tips” online. My monitor bears witness to the spittle encrustations of my vociferous discontent. By the holy and inspired laws of the Opinion Piece [ “Op. Ed.” being a less useful term when I am the only writer for this, uh, publication] I am now required to say something inflammatory and glib, so as rivet your attentions, to wit:

Budgets are useless or worse, and if you’re using one, you aren’t managing your money properly.

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