My younger brother just graduated from college this year and is getting settled into a new job, life on his own, and financial independence. Along with his first paycheck, he’s also been bombarded with a lot of new financial choices and a lot of acronyms (IRA, 401k, etc). Everyone knows they should be saving money, but the reality is that nobody ever tells you exactly how to go about it short of stuffing cash under your mattress. This post isn’t going to be an in depth discussion of what stocks to buy or how much of your net worth to put in bonds – rather, I want to focus on the mechanics of how to organize your finances as a single, newly independent young adult in order to set yourself up for prosperity and success.
I recently made a personal commitment to read more books, so I turned to the lengthy “Saved Items” cart on Amazon that I had been filling with friends’ recommendations for the past 18 months and ordered several titles. The first to arrive was Dr. Robert Cialdini’s fascinating and bestselling book “Influence: The Psychology of Persuasion”, which had been recommended to me by several friends, acquaintances, and subject matter experts, including Tim Ferriss, Guy Kawasaki, and Noah Kagan.
In is book, Cialdini (formerly a nationally renowned professor of marketing at Arizona State University) describes Six Principles of Influence which encompass every negotiation tactic and act of persuasion utilized in board rooms, living rooms and farmers markets the world over. That is to say, these are the six “puppet strings” that all of us tug at to gain compliance from those around us. They are vastly and widely applicable, from business negotiations to marketing to disagreements with your spouse. If you look closely, you’ll notice that all of us employ them every day to achieve our goals and influence those around us. Many of them are particularly applicable to entrepreneurs, so I’ve attempted to crystallize the essence of the six principles and share them below.
I have begun to think and write about China more and more lately; there is such an incredible opportunity across the Pacific that seems largely unobserved by a majority of Americans. The Chinese economy and population base is so large and modernizing so rapidly, and has transformed from 3rd world to 1st world in a matter of decades (that same evolution took us hundreds of years here in America). As you can see in this chart from Google, China’s internet adoption has blown past the United States, both in terms of growth rate and sheer number of users. And they’re still at only 20% internet penetration. Mobile phone penetration is actually higher than internet penetration, approaching 60% depending on what study you read – that’s over 500 million mobile phones. This in itself is an interesting dynamic, as it seems that in China the mobile phone (rather than the PC) is the primary method of internet use and communication. As I understand it, this is a result of the relative difficulty and expense of getting a computer and home internet line installed – particularly in rural China, which does not yet have the widespread and developed communications infrastructure that we enjoy in the United States. Coupled with pervasive and cheap mobile phone service and a proliferation of advanced smart phones, the mobile internet has become the single point of connectivity for millions of Chinese. However you measure China’s growth, it doesn’t take an economist or venture capitalist to see that the pace of technological change, adoption, and transformation in China is unlike anything experienced in America or anywhere else.
In the 19th and early 20th centuries, the American “Wild West” was a place of great opportunity and great adventure – rapid development, gold rushes, land grabs, and a booming population provided an opportunity for enterprising young men and women to strike out on their own and “grow up with the country”, as the famous quote goes. The West took on an almost mythical aura as a place where anything was possible and success was limited only by ambition.
Even after the American West had been developed, the United States has remained the epicenter of the world’s economic growth and a proverbial “land of milk and honey” for immigrants from across the globe. The best and brightest students from countries the world over aspired to one day travel to America to make their fortunes and pursue the “American Dream” – and countless many have done just that. However, while the western world has been the place to be for the past 150 years, I’m beginning to think that the next 150 may see a stark reversal of the compass needle.
As a former investment banker, I have a very, well… unique relationship with my email. For those that aren’t familiar with the life of a banking analyst – email is treated as IM, text messaging, and a pager all rolled into one, with a 24/7 expectation of response. I once had an actual nightmare about that blinking red light on my Blackberry. Accordingly, I developed somewhat of a compulsion about checking email at all hours of the day and night, an affliction I feel is shared by many in corporate America. Many of us keep our Outlook open all day and our Blackberries at hand all night, just waiting to be interrupted by that little “New Mail” popup or blinking red light. Not only is that stressful, I think it’s killing our productivity.
A study by Microsoft showed just how lethal interruptions are to productivity. The researchers taped 29 hours of people working in a typical office, and found that they were interrupted on average four times each hour. Sounds like a day at most offices. Here’s the kicker – 40% of the time, the person did not resume the task they were working on before the interruption. The more complex the task, the less likely the person was to resume working on it after an interruption. That means most of us are getting derailed from our work four times each hour, maybe more if you work in a high email traffic office.