Thursday, August 18, 2005

Good thoughts never go stale

Two tidbits that aren't from today (or even this month) but make good points, if only the right people could heed them...
  • An NYTimes editorial calls for fairness in drug sentencing, pointing out that disparities between terms for use of crack versus straight cocaine are racially biased and unsupportable.
    Congress spawned a national trend toward discriminatory sentencing when it drew a false distinction between powdered cocaine and crack cocaine for law enforcement purposes during the 1980's. Crack is simply powdered cocaine cooked in baking soda. The theory at the time -- that it was more addictive and generated more violence than powder -- was later proved false. By then, however, Congress had made crack the only drug that mandates a sentence for a first offense and fixed high sentences for people caught with relatively small quantities.
    Experts have called on Congress to fix this, but it's the kind of hot political potato that could be destined for years of malevolant neglect.
    (via How Appealing)

  • Folded space reads the books on whipping your finances into shape so that you don't have to.
    The best books seem to have the same goal in mind: not wealth, not riches, but financial independence. According to Your Money or Your Life, which I consider the very best of the financial books I've read, "financial independence is the experience of having enough — and then some". More practically, financial independence occurs when your investment income meets or exceeds your monthly expenses. Financial independence is linked to psychological freedom.
    Lots of distilled wisdom there, made easy to understand and straightforward to put into practice.
    (via Medley's furlings)


Anonymous said...

I'm left to wonder, though, in the case where one doesn't have any family money to fall back on (or to seed things), how feasible financial independence (living solely off of investment income) is... not to mention the high cost of health insurance these days.

And even if it is feasible, I'm not sure I could ever bite the bullet sufficiently hard in the meantime to get there.. (I'm reading _YMoYL_ at the moment... )


ACM said...

It's true -- if you really want to not have to worry about a job, then you'd have to be willing to work like a dog for a chunk of time (a decade, maybe?) while living in ramen-noodles student poverty. That would build up a ton of principle fast (you could probably sock away tens of thousands a year on a grown-up salary), but sort of suck meantime (unless you're still 20 and don't know the difference). Personally, I'd be willing to have my salary + investment income be enough that I was increasing my savings over time (i.e., rolling investment income back in and adding some) such that I could be financially independent in retirement. You have to suffer at some point, and I'd rather do it slowly by having a job all that time, rather than intensely but for a shorter period by living the enforced poverty lifestyle.

I guess I focused on the "having enough" part and not the "investment income" part when reading this the first time - I'm not sure that I'd ever have "psychological freedom" when my income could be wiped by a market crash or other uncertainty. I suspect that most folks would benefit by exposure to the idea of systematic discipline -- even just paying off debt rather than necessarily building up big income-generating equity, or figuring out a method that allows for regular savings. Any of those are better than living off your whole income right now, even if you don't aspire to becoming "wealthy."