How much to make you happy?

UPDATE: the video is here. If you skip forward to 17:15 or so the announcer walks on to the stage and he brings up the 60k number. Of course, the whole video is probably worth watching.

So I'm really looking forward to this TED talk from Daniel Kahneman.

The choice quote from the link:

Psychologist and Nobel Laureate Daniel Kahneman says millions of dollars won't buy you happiness, but a job that pays $60,000 a year might help. Happiness levels increase up to the $60K mark, but "above that it's a flat line," he said.

"Money does not buy you experiential happiness but lack of money certainly buys you misery," he said. But the real trick, Kahneman said, is to spend time with people you like.

So why $60k? My initial suspicion (having not seen the presentation yet, it's not up), is that this has to do with some 80/20 math. In particular, that above $60k / year puts you into the top 20% of income earners which is probably all it takes to make most people happy. It's enough.

The numbers from Wikipedia.

http://en.wikipedia.org/wiki/Personal_income_in_the_United_States

A US job that pays $60k puts you almost exactly in the top 20% of US income earners. (assuming that you have a job and are over 25) In fact, it puts you in the top 40% of household incomes. So if you make $60k+ and your husband stays at home and watches the kids, you're still making more than the average family. And you probably have a University degree or better.

If you exclude some of the outlandish parts of the country (NY, LA), then $60k + health benefits provides you a very comfortable quality of life. And if you're like most earners in this category, there's a very good chance that your spouse also works which bumps you up even higher. If you make 60k and your spouse makes even $10 / hour (i.e.: 20k), that puts your family into the top 20% of US households.

So is that going to make you happy? Why don't we "imagine the life"?

You can probably afford to travel once / year, own a relatively new car, maintain a mortgage (at 2000 rates), kids a pet and a hobby or two (if you have time).

You go to a church with 100 families and you're in the top 20 for income. In fact, your top 20 group probably makes up 50 to 75% of the church funding b/c you have more disposable income. It sounds selfish, but living in such a peer group is very comfortable feeling.

Your kid is likely one of the richest 4 or 5 kids in their class. When the kids want to hang out, they want to hang out at your place b/c you have the good TV, the good games, the good snacks and the space. Your kid gets the coolest presents or at least nobody get toys that are significantly cooler. That tends to make a parent happy.

I know these are shallow definitions. But these things would probably make most people happy.

Is 90k better than 60k?

Again, I haven't seen the presentation, but I have some postulations as to why it isn't. Mathematically, the 90k is 50% "better", but it doesn't necessarily "give you more". Remember that at 60k, you're making more than 80% of the working population (let alone those out of work). At 90k you're making more than 85 or 90% of the population, but you've really only jumped a few "notches" in the "final rankings".

In most parts of the US you already have access to a very good and healthy life at 60k. You've pretty much covered everything commonly deemed as a necessity and you probably have some money left over for "entertainment". So the jump to 90k really just gives you a little more "entertainment" and maybe some bigger stuff, but that's it.

And if you're the type who's not happy with being in the top 20%, then how much further do you need to go? Top 10%? Top 5%?

Really, 60k for one job is far enough "ahead of the game" to keep happy those that can be kept happy. And that's probably why this is true.

Where the stimulus money is coming from

I've said this to many people in several different ways, but what this recession really means for most North Americans is that they won't retire as early as planned or that they'll have to continue working at least part time to buffer their savings.

Well, here's some talk from Calculated Risk with a great quote courtesy of the NY Times.

“What the average citizen doesn’t explicitly understand is that a significant part of the government’s plan to repair the financial system and the economy is to pay savers nothing and allow damaged financial institutions to earn a nice, guaranteed spread,” said William H. Gross, co-chief investment officer of the Pacific Investment Management Company, or Pimco.

Of course, this basically screws over fixed-income retirees, but it also damages prospects for those close to retirement. If you're 60 and planning to retire at 65, you're basically making no money in safe investments, but you also don't have any time to "ride out" highly volatile investments like stocks. Unless, of course, you wait until 70 or 75 to retire.

It sounds absurd, but what else are you going to do? We've put ourselves into a really tight spot here. The Obama plan (for better or worse) is to inflate the money supply, which is going to be done at the expense of those people who want to retire. To be fair, the McCain plan wasn't really any different.

I guess the big question is really if this is simply to be expected? Personally I think the whole concept of everyone retiring at 65 and living to the ripe old age of 90 is also pretty absurd, so though I blame the US for making some pretty bad financial decisions over the last 3 decades, I also think that we have to get over our delusions of multi-decade retirements for everyone.

Classic fluff

 Here's a recent ZDNet article: 10 ways to make your boss love you

This is pretty must a classic fluff piece. Filled with specious comments and even contradictory.

"Simply doing your job isn't enough anymore..." 

Huh? My job is to bring in more money than I cost my employer (i.e.: to provide profits). If I continue to provide direct profits for my employer how am I "not doing enough"? 

"...- you have to make sure your boss knows how well you're doing it." 

No really? Wait a second, isn't it my boss's job to know how well I'm doing? If my boss doesn't know how well I'm doing and I don't know how well I'm doing, am I actually doing my job? 

If you and your boss don't know how well you're doing then you have problems way beyond these tips. 

If you really dig into these tips, most of them are your job. 

#1: Make your boss look good

Your job. 

#2: Do more with less 

#9: Automate it 

IT is automation. Automation is fundamentally "doing more with less". 

#3: Be positive, proactive and professional 

#5: Get back to basics 

Be professional = Behave as if this was your profession = Do your job 

#4: Talk the talk 

"Speak the language of the business...Make sure you are seen as involved in activities that lead to revenue generation" 

Language of the business = Your job 

Generating revenue = Your job 

#7: Stay informed

 Welcome to IT. 

#8: Become a collaborator 

Your job in IT is to solve other people's problems. Failure to collaborate is a failure to do your job.

#10: Be special 

"If your existing skills don't match up with the needs of the business then make sure you develop some news ones."

Does this quote even make sense? If your skills don't match up with the needs of the business, what the heck are you doing? I mean *your job* is to meet the needs of the business, but if you don't have the skills to do that what the heck are they paying you for? 

So like I said, the piece is really fluffy. Basically tells the reader to do their job.

The Times they are 'a-changing

Well, we know that Newspaper are going to die, and we'll have to see about print media in general. In fact, my current guess is that the next decade of iPhones and Blackberries and Kindles and podcasts and audiobooks will signal a "paper reversal". In no way do I expect "paper" copies to go away, instead I expect them to slowly be limited to only specific, revered content.

But hey, I'm already receiving my bank statements and pay stubs electronically. So the amount of paper-only content is fast diminishing.

However, I have two great links about paper today.

Time Magazine talks about the End of Excess. Which opens with a great line:

Don't pretend we didn't see this coming for a long, long time.

A few other choice quotes:

We cannot just hunker down, cross our fingers, hysterically pinch our pennies, wait for the crises to pass, blame the bankers and then go back to business as usual...This is the end of the world as we've known it. But it isn't the end of the world.

Which echoes things I've been saying for a long time. The US is going to change and it's going to change very dramatically. The "middle-class" is no longer going to be the center of this giant bell curve, things will tier much more. The US will need a broader base of producers, of people working dirty jobs.

Of course, with such a small population (on a global scale), the only way the US can stay ahead of the curve is to become an intellectual mecca for the new generation of problem solvers and thought leaders. Of course, with such a small realy population base and an underfunded education system, there will be a need to import these people.

Further increases in productivity and prosperity require ingenuity and enterprise applied at the micro scale... As China and other developing countries finally achieve the industrial plenty that we enjoyed 50 years ago, the U.S. can stay ahead once again by pioneering the next-generation technologies that the increasingly industrialized world will require...And no other nation assimilates immigrants as successfully as the U.S.

Those are just my choice quotes, the whole article is a good read.

And here's a good summary about the death of the newspaper. I think this one quote really sums it up nicely:

It makes increasingly less sense even to talk about a publishing industry, because the core problem publishing solves — the incredible difficulty, complexity, and expense of making something available to the public — has stopped being a problem.

He goes on to mention that we don't really have a good replacement model for all of these journalists we're putting out of work. Personally, I get the feeling that between ease of publisher, ease of search/aggregation and ease of rating, it's quite probably that the future of news will be a truly distributed network. Not an Associated Press style of "distributed network", but rather a loose network of data collectors and aggregators and researchers. Each of which can produce data for the next set.

In the article he makes a mention of reporters attending a town hall meeting "just in case". But in this new era of data, it's quite possible for one to film the event, have it edited for highlights, transcripted and then reviewed, blogged, twittered & pod-casted by multiple people all within hours. And unlike the previous model, these people don't even have to be the same the same people or the same group.

Of course, none of this is very conducive to being done with paper, which may be why Time is calling for changes and the Times will be changing.