The Time Paradox by Philip Zimbardo and John Boyd

The Time Paradox is another book that can fundamentally alter the way you go about your day to day and more to the point, change your view on life. The fact that it accomplishes this without delving into much philosophy makes it more valuable as it should cater to the scientific minds as well.

The name of Dr Phil Zimbardo might ring a bell if you have read anything about 20th-century psychology at all. He was the Stanford professor who in 1971 led the now famous Stanford prison experiment.

But this book doesn’t focus on that study. The Time Paradox, as the name suggests, explores the relationship we have with time. Zimbardo and Boyd show how the pace of life can change the way people behave with their peers. One example is how the faster pace of life in the Northeast cities in the US (Boston, New York, etc) led to lower results on people being helpful with each other. 

We are presented with the six orientations that each person has for time:

  • Past-negative
  • Past-positive
  • Present-fatalistic
  • Present-hedonistic
  • Future
  • Transcendental-future

Each of these orientations can influence everything in our lives, from how we work to how we behave around others and how happy we are at each moment.

Past-oriented people, in general, will be more conservative and religious, but can also be more stable. They tend to live life through rituals and might suffer from excess guilt (especially if past-negative).

Present-oriented people are more fun to be around and focus on experiences which can bring them pleasure in the moment. They struggle with delaying gratification and their thinking is more concrete (versus more abstract).

Finally, future-oriented people are more goal-oriented and can delay gratification with ease. They usually thrive on control and struggle with enjoying fun, in the moment, activities and with relationships, due to the lack of control of what the partner might say or do.

In all, a great read that can help us understand ourselves better and devise strategies to deal with shortcomings for the pursuit of a meaningful life.

future-oriented people are the most likely to be successful and the least likely to help others in need. Ironically, the people who are best able to help are the least likely to do so. In contrast, present-oriented people are less likely to be successful but are more likely to help others.

The past may give you a sense of security, especially if your recollections are good ones. However, new adventures lie ahead. If you are stuck in the past, you are less likely to take chances and risks, to make new friends, to try new foods, or to expose yourself to new music and art. You want the status quo and abhor change. If the people in a culture that uses the past to evaluate current situations share a past trauma, they are likely to want revenge—even if the crimes against them were committed many decades ago. The perceived perpetrators are not forgiven; they must be punished. This vendetta mentality undercuts attempts at peaceful reconciliation and promotes violence and warfare as new generations are obligated to avenge or pay for crimes against their parents or grandparents. To the extent that people share positive views of the past, they seek to maintain the status quo culturally and politically. They do not want change; rather, they seek to conserve and re-create in the present what was good in the past. This view may blind them to newer, better ways of doing things. In a global economy, nations that live in the past will be left behind.

Yesterday is already a dream And tomorrow but a vision But today well lived makes every yesterday a dream of happiness And every tomorrow a vision of hope.

We will win the war on terror not by destroying our enemy’s future but by nurturing it. The motivational power of the mundane future must be restored if mundane future goals are to compete with transcendental-future goals. Only by building a mundane future full of hope, optimism, respect, health, and prosperity can the motivational power of the transcendental future be balanced.

We have to respect people for their pasts and allow them to enjoy the present. The first step toward such a change must entail providing adequate resources and opportunities to those who lack them: food, shelter, and money, as well as opportunities for education, employment, recreation, relaxation, and community celebration—the basic human needs in any civilized society. A second step requires instilling a sense of personal responsibility for seizing a desirable opportunity. Individual initiative must be encouraged and rewarded. The embers of intrinsic motivation must be carefully tended and fanned. Fatalistic passivity must be replaced by an “I can do it” stance. The third step entails moderating transcendental-future time perspectives and supplementing them with more practical future time perspectives. Expecting people to change their transcendental-future beliefs is insulting, naive, and may exacerbate conflict. A more reasonable approach is to offer hope, opportunity, and fulfillment in the future on the way to the Promised Land. The development of a future time perspective requires stable political, economic, and family conditions. People must believe that their actions today will lead to predictable and desirable rewards in the future. Without stable environments, accurate prediction is impossible. Creating political, economic, social, and familial stability may require creating structures that guide and protect, stabilizing those structures, and eliminating the external forces that threaten them.

What is critical to couples’ constructive criticism of each other is to first make evident what each thinks the other person is saying: “It seems to me that what you are saying is that you don’t like X, don’t want to do Y, and believe Z is true. Is that the case, or am I misunderstanding you?” You are not accusing the other, merely opening a dialogue about perceived differences of opinion. Second, it rarely helps to nag someone about past mistakes; that only makes him guilty or defensive. Rather, reframe the criticism in terms of what he might consider doing in the future to achieve his objective. “Next time when you want me to be more socially active at the office party, let me know in advance whom you would like me to talk with, and I will do my best to oblige.” Rather than “You embarrassed me by acting like a princess who was too damn good for my friends.”

When lost in the past or engrossed in the future, you cannot be present, and happiness rushes by like a gourmet meal eaten in the car on the way to a dentist appointment. Thoughts of the past and the future can bring you happiness, but they do so by bringing happiness into the present state of mind.

Creating a municipality map of Portugal with Raphael.js

Last year I found out about a rule in the Portuguese tax code that allows local councils to give back a small percentage of the taxes to be collected back to their residents. This was seen as a measure to incentivize people to move or stay in poorer regions, which probably suffer from a shortage of jobs and services. This was a common practice in medieval times, with incentives as big as a more lax treatment in possible crimes among them1. Of course back then the risk of an Eastern invasion by a Spanish monarch was very much in the day-to-day thinking of our rulers. One can speculate that if in 2018 all the Portuguese people live by the coast is the East still Portugal? I suppose if enough Irish speakers moved there it could be claimed as part of Ireland! But I diverge.

Coming from one of the poorest regions of Portugal myself, I wondered if the “right” places were the ones indeed taking advantage of this measure and trying to attract people to live there. After a bit of research, I found that my local town didn’t use this measure but some neighbouring places did. I searched for a map so that I could visualize where this was happening and by how much (municipalities can give back up to 5% of the tax to the be collected). I didn’t find any so I thought I would create one.

GitHub project
Step 1 – Creating a municipality map in svg

This was more of a search operation than a creative one. I needed an SVG map that I could manipulate in something like JavaScript in order to load some data dynamically, such as the tax information for each council. I found one map on Wikipedia under a Creative Commons license that I could change for my purpose since it contained some errors and missed some information such as three councils. This map is not perfect because it’s missing the 30 councils that make up the archipelagos of Madeira and Açores and instead just represents the archipelago as a whole. For the purpose of this exercise, it will suffice.

Step 2 – Creating a Javascript map with Raphael.js

In order to create an interactive map, I used Raphael, a JavaScript library that allows using vector maps as JavaScript objects. Armed with the SVG data and with a way to create objects from it I started by following an online tutorial that taught me with a quick way to create a map. The hardest part was actually mapping (no pun intended) the vector data to the correct councils in an array. The SVG map didn’t have the right names, sometimes, and also didn’t have all of the councils. This left me with the time-consuming option of manually copying the data into the array.

After some time I had a map that correctly represented all of the councils with names and real borders. In order to use this in JavaScript I created a file, concelhosSVG.js , and I created the following:

The MAP_WIDTH  and MAP_HEIGHT  variables allow us to define a size to work with. The mapContainer  variable will be used in the map div in our HTML file to display the actual map. The map  variable represents the Raphael object on which we will make our manipulations. 

Finally, we define concelhosSVG which will hold an index with the name of the council and the path to append to our map variable. 

In Raphael we can use the SVG path syntax which basically allows us to start with an M  (move to) and add coordinates until we issue a Z  for ending the path.

Step 3 – Adding our map to html

Now that we have a map we can create a simple HTML page to include the map. 

I’ve gone ahead and added a simple style to our CSS file

And here’s the result

Portugal Council Map using Raphael.js
Step 4 – Adding our tax information

Now that we have a map, albeit a very ugly one, let’s add our tax information. This information is public and you can get it from the Portuguese Revenue website

We’ll create a new JavaScript file called concelhosIRS.js  and we’ll create an array inside it with all the information needed.

Step 5 – Styling our map with the tax information

Finally, we just need to syle our map based on this information. In order to do that we’ll create a new JavaScript file named main.js  and we’ll add the following code to it.

We’ll start by adding our initial style, our style when hovering the mouse over a council and the style for each of the tax brackets. I chose to create six tax brackets between 0% and 5%. The councils that don’t offer any tax benefit will not have a colour and will just show as grey.

Next, we add a function to change the styling based on the tax benefit that the council provides.

And we wrap everything together by adding our main code that initialises the map colours and adds our event listeners for when we hover our mouse over a council and move out.

Final result and notes

After a few updates to our HTML file, we end up with the following map.

Final map with colours
Final map with colours

Much nicer right?

You can find all the source code on GitHub if you want to take a look or try it out for yourself.

I’ll throw some additional notes just so you’re aware of them:

  • I have not used councils for Azores and Madeira as I couldn’t find any usable SVG for them. I also suspect they would be tiny to select, as some councils in the continent already are. The tax data for them are mapped in concelhosIRS.js though.
  • I have used global variables for the tax data and the Raphael map. I did this because it was a learning exercise for me around Raphael and SVG and not programming. Global variables are fine to use in very small projects such as this tutorial but you shouldn’t use them in any production code or larger collaborative projects. Start here and do your own research.
  • A shout out to Andy Fitch who also has a nice tutorial on this subject.

 

 

Walden or Life in the Woods by Henry David Thoreau

Walden seems to have a perennial love-hate relationshop with most readers. For me it’s the first. I can easily see how this could be a life changing book for most people, assuming you can get past the descriptions of the depth of Walden Pond and the several ways to measure it.

The first half of the book itself is brilliant so I believe that even for those that don’t finish it, Thoreau, will have passed the majority of his philosophy by then. His core tennets of loving Nature, building his own life from the ground up and living, eating and doing everything by simple means are now, possibly more than ever, needed on our 24/7 news, push notifications always on life. As a friend of mine said “I’m afraid of reading for I might leave my girlfriend and city life for the woods with only a backpack to keep me company”. 

I see young men, my townsmen, whose misfortune it is to have inherited farms, houses, barns, cattle, and farming tools; for these are more easily acquired than got rid of. Better if they had been born in the open pasture and suckled by a wolf, that they might have seen with clearer eyes what field they were called to labor in. Who made them serfs of the soil?

But men labor under a mistake. The better part of the man is soon plowed into the soil for compost. By a seeming fate, commonly called necessity, they are employed, as it says in an old book, laying up treasures which moth and rust will corrupt and thieves break through and steal. It is a fool’s life, as they will find when they get to the end of it, if not before.

Public opinion is a weak tyrant compared with our own private opinion. What a man thinks of himself, that it is which determines, or rather indicates, his fate.

One farmer says to me, “You cannot live on vegetable food solely, for it furnishes nothing to make bones with”; and so he religiously devotes a part of his day to supplying his system with the raw material of bones; walking all the while he talks behind his oxen, which, with vegetable-made bones, jerk him and his lumbering plow along in spite of every obstacle.

Most of the luxuries, and many of the so-called comforts of life, are not only not indispensable, but positive hindrances to the elevation of mankind. With respect to luxuries and comforts, the wisest have ever lived a more simple and meagre life than the poor. The ancient philosophers, Chinese, Hindoo, Persian, and Greek, were a class than which none has been poorer in outward riches, none so rich in inward.

None can be an impartial or wise observer of human life but from the vantage ground of what we should call voluntary poverty.

When a man is warmed by the several modes which I have described, what does he want next? Surely not more warmth of the same kind, as more and richer food, larger and more splendid houses, finer and more abundant clothing, more numerous, incessant, and hotter fires, and the like. When he has obtained those things which are necessary to life, there is another alternative than to obtain the superfluities; and that is, to adventure on life now, his vacation from humbler toil having commenced.

I sometimes try my acquaintances by such tests as this—Who could wear a patch, or two extra seams only, over the knee? Most behave as if they believed that their prospects for life would be ruined if they should do it. It would be easier for them to hobble to town with a broken leg than with a broken pantaloon. Often if an accident happens to a gentleman’s legs, they can be mended; but if a similar accident happens to the legs of his pantaloons, there is no help for it; for he considers, not what is truly respectable, but what is respected. We know but few men, a great many coats and breeches.

I have heard of a dog that barked at every stranger who approached his master’s premises with clothes on, but was easily quieted by a naked thief. It is an interesting question how far men would retain their relative rank if they were divested of their clothes.

Beside, clothes introduced sewing, a kind of work which you may call endless; a woman’s dress, at least, is never done.

I say, beware of all enterprises that require new clothes, and not rather a new wearer of clothes. If there is not a new man, how can the new clothes be made to fit? If you have any enterprise before you, try it in your old clothes. All men want, not something to do with, but something to do, or rather something to be. Perhaps we should never procure a new suit, however ragged or dirty the old, until we have so conducted, so enterprised or sailed in some way, that we feel like new men in the old, and that to retain it would be like keeping new wine in old bottles.

At last, we know not what it is to live in the open air, and our lives are domestic in more senses than we think. From the hearth the field is a great distance. It would be well, perhaps, if we were to spend more of our days and nights without any obstruction between us and the celestial bodies, if the poet did not speak so much from under a roof, or the saint dwell there so long. Birds do not sing in caves, nor do doves cherish their innocence in dovecots. However, if one designs to construct a dwelling-house, it behooves him to exercise a little Yankee shrewdness, lest after all he find himself in a workhouse, a labyrinth without a clue, a museum, an almshouse, a prison, or a splendid mausoleum instead. Consider first how slight a shelter is absolutely necessary.

In the large towns and cities, where civilization especially prevails, the number of those who own a shelter is a very small fraction of the whole. The rest pay an annual tax for this outside garment of all, become indispensable summer and winter, which would buy a village of Indian wigwams, but now helps to keep them poor as long as they live.

I do not mean to insist here on the disadvantage of hiring compared with owning, but it is evident that the savage owns his shelter because it costs so little, while the civilized man hires his commonly because he cannot afford to own it; nor can he, in the long run, any better afford to hire.

If it is asserted that civilization is a real advance in the condition of man—and I think that it is, though only the wise improve their advantages—it must be shown that it has produced better dwellings without making them more costly; and the cost of a thing is the amount of what I will call life which is required to be exchanged for it, immediately or in the long run.

Most men appear never to have considered what a house is, and are actually though needlessly poor all their lives because they think that they must have such a one as their neighbors have.

I had three pieces of limestone on my desk, but I was terrified to find that they required to be dusted daily, when the furniture of my mind was all undusted still, and threw them out the window in disgust. How, then, could I have a furnished house? I would rather sit in the open air, for no dust gathers on the grass, unless where man has broken ground.

The cart before the horse is neither beautiful nor useful. Before we can adorn our houses with beautiful objects the walls must be stripped, and our lives must be stripped, and beautiful housekeeping and beautiful living be laid for a foundation: now, a taste for the beautiful is most cultivated out of doors, where there is no house and no housekeeper.

Those things for which the most money is demanded are never the things which the student most wants. Tuition, for instance, is an important item in the term bill, while for the far more valuable education which he gets by associating with the most cultivated of his contemporaries no charge is made.

This spending of the best part of one’s life earning money in order to enjoy a questionable liberty during the least valuable part of it reminds me of the Englishman who went to India to make a fortune first, in order that he might return to England and live the life of a poet. He should have gone up garret at once. “What!” exclaim a million Irishmen starting up from all the shanties in the land, “is not this railroad which we have built a good thing?” Yes, I answer, comparatively good, that is, you might have done worse; but I wish, as you are brothers of mine, that you could have spent your time better than digging in this dirt.

if one would live simply and eat only the crop which he raised, and raise no more than he ate, and not exchange it for an insufficient quantity of more luxurious and expensive things, he would need to cultivate only a few rods of ground, and that it would be cheaper to spade up that than to use oxen to plow it, and to select a fresh spot from time to time than to manure the old, and he could do all his necessary farm work as it were with his left hand at odd hours in the summer; and thus he would not be tied to an ox, or horse, or cow, or pig, as at present.

I am wont to think that men are not so much the keepers of herds as herds are the keepers of men, the former are so much the freer. Men and oxen exchange work; but if we consider necessary work only, the oxen will be seen to have greatly the advantage, their farm is so much the larger. Man does some of his part of the exchange work in his six weeks of haying, and it is no boy’s play. Certainly no nation that lived simply in all respects, that is, no nation of philosophers, would commit so great a blunder as to use the labor of animals.

I learned from my two years’ experience that it would cost incredibly little trouble to obtain one’s necessary food, even in this latitude; that a man may use as simple a diet as the animals, and yet retain health and strength.

I made a study of the ancient and indispensable art of bread-making, consulting such authorities as offered, going back to the primitive days and first invention of the unleavened kind, when from the wildness of nuts and meats men first reached the mildness and refinement of this diet, and travelling gradually down in my studies through that accidental souring of the dough which, it is supposed, taught the leavening process, and through the various fermentations thereafter, till I came to “good, sweet, wholesome bread,” the staff of life.

Every New Englander might easily raise all his own breadstuffs in this land of rye and Indian corn, and not depend on distant and fluctuating markets for them. Yet so far are we from simplicity and independence that, in Concord, fresh and sweet meal is rarely sold in the shops, and hominy and corn in a still coarser form are hardly used by any. For the most part the farmer gives to his cattle and hogs the grain of his own producing, and buys flour, which is at least no more wholesome, at a greater cost, at the store.

Furniture! Thank God, I can sit and I can stand without the aid of a furniture warehouse. What man but a philosopher would not be ashamed to see his furniture packed in a cart and going up country exposed to the light of heaven and the eyes of men, a beggarly account of empty boxes? That is Spaulding’s furniture. I could never tell from inspecting such a load whether it belonged to a so-called rich man or a poor one; the owner always seemed poverty-stricken. Indeed, the more you have of such things the poorer you are. Each load looks as if it contained the contents of a dozen shanties; and if one shanty is poor, this is a dozen times as poor. Pray, for what do we move ever but to get rid of our furniture, our exuvioe: at last to go from this world to another newly furnished, and leave this to be burned?

“But what shall I do with my furniture?”—My gay butterfly is entangled in a spider’s web then. Even those who seem for a long while not to have any, if you inquire more narrowly you will find have some stored in somebody’s barn. I look upon England today as an old gentleman who is travelling with a great deal of baggage, trumpery which has accumulated from long housekeeping, which he has not the courage to burn; great trunk, little trunk, bandbox, and bundle. Throw away the first three at least. It would surpass the powers of a well man nowadays to take up his bed and walk, and I should certainly advise a sick one to lay down his bed and run. When I have met an immigrant tottering under a bundle which contained his all—looking like an enormous wen which had grown out of the nape of his neck—I have pitied him, not because that was his all, but because he had all that to carry.

A lady once offered me a mat, but as I had no room to spare within the house, nor time to spare within or without to shake it, I declined it, preferring to wipe my feet on the sod before my door. It is best to avoid the beginnings of evil.

For more than five years I maintained myself thus solely by the labor of my hands, and I found that, by working about six weeks in a year, I could meet all the expenses of living. The whole of my winters, as well as most of my summers, I had free and clear for study.

In short, I am convinced, both by faith and experience, that to maintain one’s self on this earth is not a hardship but a pastime, if we will live simply and wisely; as the pursuits of the simpler nations are still the sports of the more artificial. It is not necessary that a man should earn his living by the sweat of his brow, unless he sweats easier than I do.

I would not have any one adopt my mode of living on any account; for, beside that before he has fairly learned it I may have found out another for myself, I desire that there may be as many different persons in the world as possible; but I would have each one be very careful to find out and pursue his own way, and not his father’s or his mother’s or his neighbor’s instead.

Above all, as I have implied, the man who goes alone can start today; but he who travels with another must wait till that other is ready, and it may be a long time before they get off.

There is no odor so bad as that which arises from goodness tainted. It is human, it is divine, carrion. If I knew for a certainty that a man was coming to my house with the conscious design of doing me good, I should run for my life, as from that dry and parching wind of the African deserts called the simoom, which fills the mouth and nose and ears and eyes with dust till you are suffocated, for fear that I should get some of his good done to me—some of its virus mingled with my blood. No—in this case I would rather suffer evil the natural way.

A man is not a good man to me because he will feed me if I should be starving, or warm me if I should be freezing, or pull me out of a ditch if I should ever fall into one. I can find you a Newfoundland dog that will do as much. Philanthropy is not love for one’s fellow-man in the broadest sense.

Be sure that you give the poor the aid they most need, though it be your example which leaves them far behind. If you give money, spend yourself with it, and do not merely abandon it to them. We make curious mistakes sometimes. Often the poor man is not so cold and hungry as he is dirty and ragged and gross. It is partly his taste, and not merely his misfortune. If you give him money, he will perhaps buy more rags with it. I was wont to pity the clumsy Irish laborers who cut ice on the pond, in such mean and ragged clothes, while I shivered in my more tidy and somewhat more fashionable garments, till, one bitter cold day, one who had slipped into the water came to my house to warm him, and I saw him strip off three pairs of pants and two pairs of stockings ere he got down to the skin, though they were dirty and ragged enough, it is true, and that he could afford to refuse the extra garments which I offered him, he had so many intra ones. This ducking was the very thing he needed. Then I began to pity myself, and I saw that it would be a greater charity to bestow on me a flannel shirt than a whole slop-shop on him.

I would not subtract anything from the praise that is due to philanthropy, but merely demand justice for all who by their lives and works are a blessing to mankind. I do not value chiefly a man’s uprightness and benevolence, which are, as it were, his stem and leaves. Those plants of whose greenness withered we make herb tea for the sick serve but a humble use, and are most employed by quacks. I want the flower and fruit of a man; that some fragrance be wafted over from him to me, and some ripeness flavor our intercourse. His goodness must not be a partial and transitory act, but a constant superfluity, which costs him nothing and of which he is unconscious. This is a charity that hides a multitude of sins.

a man is rich in proportion to the number of things which he can afford to let alone.

After a partial cessation of his sensuous life, the soul of man, or its organs rather, are reinvigorated each day, and his Genius tries again what noble life it can make. All memorable events, I should say, transpire in morning time and in a morning atmosphere. The Vedas say, “All intelligences awake with the morning.” Poetry and art, and the fairest and most memorable of the actions of men, date from such an hour. All poets and heroes, like Memnon, are the children of Aurora, and emit their music at sunrise.

I went to the woods because I wished to live deliberately, to front only the essential facts of life, and see if I could not learn what it had to teach, and not, when I came to die, discover that I had not lived.

Simplicity, simplicity, simplicity! I say, let your affairs be as two or three, and not a hundred or a thousand; instead of a million count half a dozen, and keep your accounts on your thumb-nail. In the midst of this chopping sea of civilized life, such are the clouds and storms and quicksands and thousand-and-one items to be allowed for, that a man has to live, if he would not founder and go to the bottom and not make his port at all, by dead reckoning, and he must be a great calculator indeed who succeeds. Simplify, simplify. Instead of three meals a day, if it be necessary eat but one; instead of a hundred dishes, five; and reduce other things in proportion.

For my part, I could easily do without the post-office. I think that there are very few important communications made through it. To speak critically, I never received more than one or two letters in my life—I wrote this some years ago—that were worth the postage. The penny-post is, commonly, an institution through which you seriously offer a man that penny for his thoughts which is so often safely offered in jest. And I am sure that I never read any memorable news in a newspaper. If we read of one man robbed, or murdered, or killed by accident, or one house burned, or one vessel wrecked, or one steamboat blown up, or one cow run over on the Western Railroad, or one mad dog killed, or one lot of grasshoppers in the winter—we never need read of another. One is enough. If you are acquainted with the principle, what do you care for a myriad instances and applications? To a philosopher all news, as it is called, is gossip, and they who edit and read it are old women over their tea. Yet not a few are greedy after this gossip.

Books are the treasured wealth of the world and the fit inheritance of generations and nations. Books, the oldest and the best, stand naturally and rightfully on the shelves of every cottage. They have no cause of their own to plead, but while they enlighten and sustain the reader his common sense will not refuse them. Their authors are a natural and irresistible aristocracy in every society, and, more than kings or emperors, exert an influence on mankind. When the illiterate and perhaps scornful trader has earned by enterprise and industry his coveted leisure and independence, and is admitted to the circles of wealth and fashion, he turns inevitably at last to those still higher but yet inaccessible circles of intellect and genius, and is sensible only of the imperfection of his culture and the vanity and insufficiency of all his riches, and further proves his good sense by the pains which be takes to secure for his children that intellectual culture whose want he so keenly feels; and thus it is that he becomes the founder of a family.

Sometimes, in a summer morning, having taken my accustomed bath, I sat in my sunny doorway from sunrise till noon, rapt in a revery, amidst the pines and hickories and sumachs, in undisturbed solitude and stillness, while the birds sing around or flitted noiseless through the house, until by the sun falling in at my west window, or the noise of some traveller’s wagon on the distant highway, I was reminded of the lapse of time. I grew in those seasons like corn in the night, and they were far better than any work of the hands would have been. They were not time subtracted from my life, but so much over and above my usual allowance. I realized what the Orientals mean by contemplation and the forsaking of works. For the most part, I minded not how the hours went. The day advanced as if to light some work of mine; it was morning, and lo, now it is evening, and nothing memorable is accomplished. Instead of singing like the birds, I silently smiled at my incessant good fortune.

While I enjoy the friendship of the seasons I trust that nothing can make life a burden to me. The gentle rain which waters my beans and keeps me in the house today is not drear and melancholy, but good for me too. Though it prevents my hoeing them, it is of far more worth than my hoeing. If it should continue so long as to cause the seeds to rot in the ground and destroy the potatoes in the low lands, it would still be good for the grass on the uplands, and, being good for the grass, it would be good for me.

I find it wholesome to be alone the greater part of the time. To be in company, even with the best, is soon wearisome and dissipating. I love to be alone. I never found the companion that was so companionable as solitude. We are for the most part more lonely when we go abroad among men than when we stay in our chambers. A man thinking or working is always alone, let him be where he will. Solitude is not measured by the miles of space that intervene between a man and his fellows.

It would be better if there were but one inhabitant to a square mile, as where I live. The value of a man is not in his skin, that we should touch him.

I have a great deal of company in my house; especially in the morning, when nobody calls.

I had three chairs in my house; one for solitude, two for friendship, three for society.

Many of our houses, both public and private, with their almost innumerable apartments, their huge halls and their cellars for the storage of wines and other munitions of peace, appear to be extravagantly large for their inhabitants. They are so vast and magnificent that the latter seem to be only vermin which infest them.

If one guest came he sometimes partook of my frugal meal, and it was no interruption to conversation to be stirring a hasty-pudding, or watching the rising and maturing of a loaf of bread in the ashes, in the meanwhile. But if twenty came and sat in my house there was nothing said about dinner, though there might be bread enough for two, more than if eating were a forsaken habit; but we naturally practised abstinence; and this was never felt to be an offence against hospitality, but the most proper and considerate course. The waste and decay of physical life, which so often needs repair, seemed miraculously retarded in such a case, and the vital vigor stood its ground.

husbandry was once a sacred art; but it is pursued with irreverent haste and heedlessness by us, our object being to have large farms and large crops merely. We have no festival, nor procession, nor ceremony, not excepting our cattle-shows and so-called Thanksgivings, by which the farmer expresses a sense of the sacredness of his calling, or is reminded of its sacred origin. It is the premium and the feast which tempt him.

By avarice and selfishness, and a grovelling habit, from which none of us is free, of regarding the soil as property, or the means of acquiring property chiefly, the landscape is deformed, husbandry is degraded with us, and the farmer leads the meanest of lives. He knows Nature but as a robber.

These beans have results which are not harvested by me. Do they not grow for woodchucks partly? The ear of wheat (in Latin spica, obsoletely speca, from spe, hope) should not be the only hope of the husbandman; its kernel or grain (granum from gerendo, bearing) is not all that it bears. How, then, can our harvest fail? Shall I not rejoice also at the abundance of the weeds whose seeds are the granary of the birds? It matters little comparatively whether the fields fill the farmer’s barns. The true husbandman will cease from anxiety, as the squirrels manifest no concern whether the woods will bear chestnuts this year or not, and finish his labor with every day, relinquishing all claim to the produce of his fields, and sacrificing in his mind not only his first but his last fruits also.

Every man has to learn the points of compass again as often as be awakes, whether from sleep or any abstraction. Not till we are lost, in other words not till we have lost the world, do we begin to find ourselves, and realize where we are and the infinite extent of our relations.

I was never molested by any person but those who represented the State. I had no lock nor bolt but for the desk which held my papers, not even a nail to put over my latch or windows. I never fastened my door night or day, though I was to be absent several days; not even when the next fall I spent a fortnight in the woods of Maine. And yet my house was more respected than if it had been surrounded by a file of soldiers. The tired rambler could rest and warm himself by my fire, the literary amuse himself with the few books on my table, or the curious, by opening my closet door, see what was left of my dinner, and what prospect I had of a supper.

I am convinced, that if all men were to live as simply as I then did, thieving and robbery would be unknown. These take place only in communities where some have got more than is sufficient while others have not enough.

“You who govern public affairs, what need have you to employ punishments? Love virtue, and the people will be virtuous. The virtues of a superior man are like the wind; the virtues of a common man are like the grass—I the grass, when the wind passes over it, bends.”

I lived in a tight, light, and clean house, which hardly cost more than the annual rent of such a ruin as his commonly amounts to; and how, if he chose, he might in a month or two build himself a palace of his own; that I did not use tea, nor coffee, nor butter, nor milk, nor fresh meat, and so did not have to work to get them; again, as I did not work hard, I did not have to eat hard, and it cost me but a trifle for my food; but as he began with tea, and coffee, and butter, and milk, and beef, he had to work hard to pay for them, and when he had worked hard he had to eat hard again to repair the waste of his system—and

he had rated it as a gain in coming to America, that here you could get tea, and coffee, and meat every day. But the only true America is that country where you are at liberty to pursue such a mode of life as may enable you to do without these, and where the state does not endeavor to compel you to sustain the slavery and war and other superfluous expenses which directly or indirectly result from the use of such things.

I told him, that as he worked so hard at bogging, he required thick boots and stout clothing, which yet were soon soiled and worn out, but I wore light shoes and thin clothing, which cost not half so much, though he might think that I was dressed like a gentleman (which, however, was not the case), and in an hour or two, without labor, but as a recreation, I could, if I wished, catch as many fish as I should want for two days, or earn enough money to support me a week. If he and his family would live simply, they might all go a-huckleberrying in the summer for their amusement.

We should come home from far, from adventures, and perils, and discoveries every day, with new experience and character.

there is something essentially unclean about this diet and all flesh, and I began to see where housework commences, and whence the endeavor, which costs so much, to wear a tidy and respectable appearance each day, to keep the house sweet and free from all ill odors and sights. Having been my own butcher and scullion and cook, as well as the gentleman for whom the dishes were served up, I can speak from an unusually complete experience. The practical objection to animal food in my case was its uncleanness; and besides, when I had caught and cleaned and cooked and eaten my fish, they seemed not to have fed me essentially. It was insignificant and unnecessary, and cost more than it came to. A little bread or a few potatoes would have done as well, with less trouble and filth.

I believe that every man who has ever been earnest to preserve his higher or poetic faculties in the best condition has been particularly inclined to abstain from animal food, and from much food of any kind.

It may be vain to ask why the imagination will not be reconciled to flesh and fat. I am satisfied that it is not. Is it not a reproach that man is a carnivorous animal? True, he can and does live, in a great measure, by preying on other animals; but this is a miserable way—as any one who will go to snaring rabbits, or slaughtering lambs, may learn—and he will be regarded as a benefactor of his race who shall teach man to confine himself to a more innocent and wholesome diet. Whatever my own practice may be, I have no doubt that it is a part of the destiny of the human race, in its gradual improvement, to leave off eating animals, as surely as the savage tribes have left off eating each other when they came in contact with the more civilized.

No man ever followed his genius till it misled him. Though the result were bodily weakness, yet perhaps no one can say that the consequences were to be regretted, for these were a life in conformity to higher principles. If the day and the night are such that you greet them with joy, and life emits a fragrance like flowers and sweet-scented herbs, is more elastic, more starry, more immortal—that is your success. All nature is your congratulation, and you have cause momentarily to bless yourself. The greatest gains and values are farthest from being appreciated. We easily come to doubt if they exist. We soon forget them. They are the highest reality.

I would fain keep sober always; and there are infinite degrees of drunkenness. I believe that water is the only drink for a wise man; wine is not so noble a liquor; and think of dashing the hopes of a morning with a cup of warm coffee, or of an evening with a dish of tea! Ah, how low I fall when I am tempted by them!

“The soul not being mistress of herself,” says Thseng-tseu, “one looks, and one does not see; one listens, and one does not hear; one eats, and one does not know the savor of food.” He who distinguishes the true savor of his food can never be a glutton; he who does not cannot be otherwise. A puritan may go to his brown-bread crust with as gross an appetite as ever an alderman to his turtle. Not that food which entereth into the mouth defileth a man, but the appetite with which it is eaten. It is neither the quality nor the quantity, but the devotion to sensual savors; when that which is eaten is not a viand to sustain our animal, or inspire our spiritual life, but food for the worms that possess us.

We are conscious of an animal in us, which awakens in proportion as our higher nature slumbers. It is reptile and sensual, and perhaps cannot be wholly expelled; like the worms which, even in life and health, occupy our bodies. Possibly we may withdraw from it, but never change its nature. I fear that it may enjoy a certain health of its own; that we may be well, yet not pure.

From exertion come wisdom and purity; from sloth ignorance and sensuality.

We should be blessed if we lived in the present always, and took advantage of every accident that befell us, like the grass which confesses the influence of the slightest dew that falls on it; and did not spend our time in atoning for the neglect of past opportunities, which we call doing our duty. We loiter in winter while it is already spring.

Every man is the lord of a realm beside which the earthly empire of the Czar is but a petty state, a hummock left by the ice. Yet some can be patriotic who have no self-respect, and sacrifice the greater to the less. They love the soil which makes their graves, but have no sympathy with the spirit which may still animate their clay. Patriotism is a maggot in their heads. What was the meaning of that South–Sea Exploring Expedition, with all its parade and expense, but an indirect recognition of the fact that there are continents and seas in the moral world to which every man is an isthmus or an inlet, yet unexplored by him, but that it is easier to sail many thousand miles through cold and storm and cannibals, in a government ship, with five hundred men and boys to assist one, than it is to explore the private sea, the Atlantic and Pacific Ocean of one’s being alone.

However mean your life is, meet it and live it; do not shun it and call it hard names. It is not so bad as you are. It looks poorest when you are richest. The faultfinder will find faults even in paradise. Love your life, poor as it is. You may perhaps have some pleasant, thrilling, glorious hours, even in a poorhouse. The setting sun is reflected from the windows of the almshouse as brightly as from the rich man’s abode; the snow melts before its door as early in the spring.

Cultivate poverty like a garden herb, like sage. Do not trouble yourself much to get new things, whether clothes or friends. Turn the old; return to them. Things do not change; we change. Sell your clothes and keep your thoughts.

We are often reminded that if there were bestowed on us the wealth of Croesus, our aims must still be the same, and our means essentially the same. Moreover, if you are restricted in your range by poverty, if you cannot buy books and newspapers, for instance, you are but confined to the most significant and vital experiences; you are compelled to deal with the material which yields the most sugar and the most starch. It is life near the bone where it is sweetest. You are defended from being a trifler. No man loses ever on a lower level by magnanimity on a higher. Superfluous wealth can buy superfluities only. Money is not required to buy one necessary of the soul.

There is an incessant influx of novelty into the world, and yet we tolerate incredible dulness.

Ireland Budget 2018

Budget 2018 has come and gone without a lot of new measures. Citizens Information has a good overview of all the measures introduced and changed by the government.

The main changes for income tax are the raise on the cutoff point for the standard rate (20%) of 750 euros to 34,550 and the reduction of the two mid-level USC brackets, from 2.5% to 2% and from 5% to 4.75%.

As usual, I’ve updated the spreadsheet for tax calculations which is available here.

Irish Taxes for the Expat (Part 2)

Today I’ll talk about benefits in kind, and how they are taxed and some of the programs in place in Ireland that you can take advantage of.

What are Benefits in Kind?

Benefits in kind are all benefits that an employer might give you that aren’t necessarily part of your regular income. They can range from medical insurance to cars and loans.

The Revenue website states that employees with an income above 1.905 euros, including benefits, will need to be taxed, but employers can give small benefits up to 500 euros per year, as long as they are not cash, free of tax.

We’ll take a look to some of the more common benefits employers might provide.

Medical Insurance

Medical Insurance is a common benefit in kind offered by many employers in Ireland. The employer will pay upfront the premium to the insurance company (VHI, Laya and Irish Life are the most common) and the employee and dependents will be insured for the year. The employee rarely needs to do anything in order to keep the cover going, as long as he/she is employed continuously. Of course, it doesn’t dispense talking with your local human resources department for more information.

In terms of taxes there are two considerations to know:

  • The employee will be taxed on the value of the medical insurance for himself and dependents. As an example imagine the cover for one adult would be 1.500 euros and for one child 800 euros. A family of three with two adults and one child would total 3.800 euros for the year. This value will be added up to the total income of the employee and it will be taxed at the normal marginal tax rate plus USC and PRSI. In the above example if the employee was at the top rate of tax, above 70.000 euros, would pay 52% on the insurance premium, which comes at 1.976 euros. This amount would be deducted from the employee’s salary automatically every pay cycle.
  • The employee is eligible for a tax credit on the medical insurance. Up until 2014, the full premium was eligible for a tax credit at the standard rate (20%). From 2014 onward there is a limit of 1.000 euros per adult and 500 euros per child in terms of premium that can be considered for the tax credit, which is still at the standard tax rate of 20%. Going back to the above example our employee in 2013 would be able to get a tax credit of 760 euros (3.800 x 0.2). From 2014 on the tax credit is reduced to 500 euros [(1.000 + 1.000 + 500) x 0.2]. In order to claim the tax credit, a Form 12 for the respective year needs to be filled and sent to the local Revenue office or it can be done online via myAccount, the online Revenue service. Be aware that the forms might change from year to year and you’ll need to get the correct Form 12. If using myAccount this can be done by editing the tax credits for the year in question. As with most thing Revenue related you can amend tax credits up to 4 years in the past.

It might be useful, since we’re on the topic of medical insurance, to know that the Form 12 is also used to claim any medical expenses that haven’t been covered by medical insurance. These will grant a tax credit at the standard rate of 20%. Please consult the list of medical expenses that can be considered here.

It’s also useful to note that if buying medical insurance directly, typically, the insurer will discount from the premium to pay the amount of tax credit due, but if the insurer doesn’t do it you should claim it with the Revenue.

Bike to Work Scheme

Another popular benefit employers might give employees is the Bike to Work Scheme. This scheme allows for an employee to buy a bicycle and equipment up to 1.000 euros and the amount in question will be deducted by the employer from the employee’s income pre-tax, which means that the employee tax bill will be reduced at their marginal tax rate plus USC and PRSI.

Let’s look at an example. Joe makes 40.000 euros per year from his job. He buys a bicycle and some equipment which cost him 800 euros. His employer takes the burden of paying for it to the shop and in turn, it will deduct the 800 euros from Joe’s salary, which means Joe will only make 39.200 euros now. This reduces his tax bill for the year (less income means less tax) by 392 euros (49% which is the marginal tax rate for Joe’s salary) and his income by 408 euros (which is the remaining balance, used to actually pay for the bike and equipment in a way). What this means for Joe is that he saved almost half of the cost of the bicycle and equipment in this way.

In order to benefit from this, the employee must buy the bike and equipment from a registered store in the scheme and employer must also be registered to provide this benefit. For more information visit www.biketowork.ie.

Tax Saver Tickets

This benefit is identical to the Bike to Work scheme, only it applies to other public means of transport that exist in Ireland. Covered services include Irish Rail (including Dublin services like DART and Commuter trains), Bus Eireann (long distance buses), Dublin Bus and Luas (Dublin light rail).

For more information visit www.taxsaver.ie.

Conclusion

We’ve looked at what I believe are the three most popular benefits that Irish employees have at their disposal in order to reduce their tax bill. I don’t know of many other schemes like these that have a big impact on the personal finances, but let me know if there are any in the comments.

Compound interest in your career: how use the power of the environment to accelerate your professional growth

Over the last week I’ve been reading Judith Rich Harris’ The Nurture Assumption, where the author exposes the idea that children are not so much influenced by their parents as they are by their peers. Most examples Harris gives us during the book show that the environment in which children grow up is a lot more powerful in socializing them than their parents. Despite best intentions for getting children to behave in certain ways at home, the world outside and other children are the key to derive their social behaviors which might or might not impact their adult lives.

This got me thinking about a very simple observation from the workplace. Put mediocre engineers in a team of great engineers and watch them grow. Seems obvious once it’s stated like this doesn’t it? And yet how many people forget about this simple principle when applying and choosing a job?

Let me elaborate a little bit on this last rhetorical question. Imagine you’re looking for a new job and after some arduous code tests and technical interviews you finally have a couple of offers in your hand. As a software engineer you want to work with a hopefully recent and great technology (whatever that means for your particular industry and interests), get a nice salary and work on challenging products. These are the most common requirements when thinking about a job offer.

  • What technology do you guys use?
  • How much am I going to get paid?
  • What will I be working on?

These are the typical questions I hear from candidates in interviews. A surprising small number of candidates ask the question “What does your team look like and how do you work together?”.

The reason why that is surprising to me is that working in a team of great engineers who put the focus on sharing knowledge, helping others and educating the team has the same power as essentially compound interest for your career. In other words, it’s a snowball effect disguised in plain sight. Tools of Titans’ author Tim Ferriss already said that you are the average of the five people that you spend more time with. I’ll propose here that you should be using that when it’s time to choose a job.

Let’s think about this for a moment by examining each one of these questions in more detail.

If you take the job with the most recent technology does that guarantee you’ll grow your career, become smarter and get more money in the long run? Maybe. That’s the honest answer. Technologies come and go and in a software engineer’s lifetime you’ll probably end up working with dozens of programming languages, frameworks and techniques. Do you want to bet your career in Angular’s success? What about Spring? Should you be the .NET MVC guy? I’ll grant you specializing in a particular technology could allow you to surf a wave of clients and projects for as much as a decade with great return on investment, especially if you work as a consultant directly for clients, taking out agencies and other services middlemen. Bur surely you can’t be thinking in realistic terms to be using this 15 or 20 years from now and counting on it to pay your bills?

Speaking about bills, what about money? Surely you can’t be saying that I shouldn’t take the highest paying job, all other things being equal. Again, my answer will be maybe. It will depend a lot on which phase of your career you are, on your own personal goals and just responsibilities. Maybe you have a family that depends on you. Maybe you want to make a big investment in a couple of years and you need to save some cash for that. The point is, this will be a contentious answer no matter which way I put it. The reason why I’m bringing it up then is to give you an alternative view to the common position, which is just taking the highest paid offer. What about taking the offer where you’ll be working on more difficult challenges? What about taking the offer where you’ll be working with a great team? If you apply some long term thinking to this, and taking some numbers to illustrate this example, you might be refusing company’s A 50k offer to go work with company B on a 40k offer that allows you to grow at 4x the pace you would in your highest offer. Presumably you will be adding much more value in a year or two at company B that the managers will have no choice but to promote you. The worst case scenario on company A is you being tied down to a 50k+ job in 2 years time without any real options to grow from there. The worst case scenario on company B has you not being promoted by the managers, still making less money than on company A but with confidence and skills to command higher offers from other companies, should you decide to leave. Of course this is dependent on job markets, but just for the numbers themselves. Value is value, no matter what part of the globe you are and if you add value people will jump at giving you opportunities (and money to go with them).

The last of our three questions has to do with what will you be working on. This one is probably one of the most relevant for me. A good product can help you learn a lot about software architecture, design and patterns. Working with legacy code bases, while not pleasant for the most part, could provide an opportunity for relentless refactoring, assuming quality checkpoints such as automated regression testing are in place. Again, the answer here about your career growth being tied directly to the projects you work on is maybe. The project can go horribly wrong and yet you learned so much from it that you have a newfound confidence about tackling other challenges in the next project. The project can also be cruising along well and you can be working on maintenance with very little emphasis on actually improving the product. And this will have me jump straight into my last question and the one that I consider to be the most important one to ask.

Who do you think will have the better chance of becoming a great software professional in the long run, the developer who ended up working with his favorite technology, in a challenging project by himself (and making more money in the meantime) or the developer who had to learn something new from a great team that put time in to teach him and offered so much advice on how to write code, design practices and architecture that he now can teach it himself?

I truly believe it’s the second. Great teams make great software. And great teams are hard to come by, but that doesn’t mean they don’t exist and surely it doesn’t mean you can’t ask about them in a job interview. The environment around us plays a huge role in shaping everything about us. A smart coder turned loose in a team that plays along well with anybody will transform him, one can say 10x him, to use the famous 10x metaphor. Humans are a social species and as such, it’s only natural that we learn from others. I can definitely see great developers ending up in crappy (or non existent) teams, working in recent technology stacks and what it just brings them unhappiness. Unhappy developers are not productive developers. And developers that are not productive don’t learn as much, which directly translates into career stagnation.

Conclusion

Stretching to learn by yourself is a great strategy for growth but it doesn’t beat working 8 hours per day in a team that throws so much feedback and knowledge at you that by the time you realize it you are the equivalent of a veteran in your lone wolf friend’s company. Bringing it back to the idea of compound interest, your learning, your drive to excel, that is the principle. We can assume it will grow linearly throughout time. What you learn via your team, that is the interest that you get and this will grow exponentially. The key to accelerate your career growth is then, counter-intuitively, to give it to others around you and not focus on it yourself too much. Think about it the next time you’re interviewing for a job and who knows, you might just 10x yourself in a couple of years.

Irish Taxes for the Expat (Part 1)

Today I’m going to talk about what I’ve learned so far about Irish taxes. I’m sure there are plenty of nooks and crannies to explore on the subject, and I’ll provide sources for everything that I’ve found to back them, but I’ll leave readers to interpret those sources by themselves. This is my polite way to say that I won’t be held responsible if the Revenue comes for you 🙂

I’m also talking from the perspective of an expat living in Ireland, so keep that in mind. In other words, this is stuff that I would like someone to have explained to me before moving to Ireland.

Overview

The Irish tax system is very progressive. That seems to be a fact. It also seems to work pretty damn well, but this is purely based on my experiences after a few years living and working in Ireland and taking into account that I have other countries where I have lived to compare against.

PAYE

For the purposes of this post I’ll cover only the Pay As You Earn (PAYE) system, which is the traditional system under which all employees (in the sense that you are working for somebody else, usually a company that pays you a salary) earn income. There are different rules for self employed people.

The bands of tax are very simple. There is a Standard Rate of 20% and a Higher Rate of 40%. That’s it. Only two bands. Seems too good to be true right? It is. As we’ll see further down, matter get more complicated, but nothing compared to my native country I assure you.

How do you know which band you pay tax on? I mentioned earlier that the Irish are very progressive with their tax. The rules then are:

Income up to 33.800 euros -> You pay 20%

All other income above that -> You pay 40%

Some countries put the tax payers on a band according to their absolute income. For example, if you were to make 40.000 euros in income other countries would tax the whole of your income at 40% (assuming the same two bands as the Irish system), making it a not so progressive system.

So far, so good, seems pretty simple.

Consult the official Revenue documentation here.

Universal Social Charge

Universal Social Charge, or USC for short, is one of the most dreaded taxes in Ireland. Why, you might ask? Well, once upon a time, not so long ago, there was no USC. The roar of the Celtic Tiger could be heard throughout the land. But one day the Tiger fell down into a rabbit hole, of all places, and a very big one at that. Once it managed to climb back out of the hole the roar was gone and the USC was on.

How does this tax work? It’s applicable to all income and tax credits don’t have an effect on it. It’s also applicable on other things, such as benefit in kind payments. This tax has been reduced for 2016 and again for 2017. The current rate of tax are the following:

Income up to 12.012 euros -> You pay 0.5%

Income between 12.012 – 18.668 euros -> You pay 2.5%

Income between 18.668 – 70.044 euros -> You pay 5%

Income between 70.044 – 100.000 euros -> You pay 8%

Income above 100.000 -> You pay 8%*

*I believe this value is 10% for self employed. I’m not sure if this changed for 2017.

See more about the USC here.

Tax Credits

The Irish system works by using a number of Tax Credits against your income, in order to assess how much money you owe to the Revenue. The Tax Credits are essentially allowances that reduce the amount of income that is taxable. Under the PAYE system all employees are entitled to a Tax Credit worth 1.650 euros.

Another tax credit that all people are entitled is worth another 1.650 euros. From this we can deduct that the majority of employees in Ireland have at least 3.300 euros worth of tax credits.

Examples of other tax credits include dependent care, single parent or health insurance.

See more about tax credits here.

Pay Related Social Insurance

PRSI is not exactly a tax, since it’s not charged by the Revenue. It’s charged by the Irish Welfare system and the goal is to provide Social Welfare to citizens and residents. The rate for employees is 4% on all income subject to PRSI, which typically is the same as all income subject to USC.

Learn more about PRSI here.

Emergency Tax

Finally, an important note on emergency tax, which typically happens when you start working in Ireland as an expat or change jobs. Let’s imagine you land in Ireland in June and you start working. The Revenue assumes you should be paying tax since January 1st and when they see you haven’t they also assume you’ve been making the amount of your first paycheck since January 1st. This is due to the fact that they haven’t received a P45, which is a statement an employer gives an employee after the contract has finished, for tax purposes. You’re brand new so there’s no P45 in store for you! Relax, there’s a solution, and a simple one at that. Give the Revenue a ring or contact them by email and they’ll update your status. Usually this takes one or two months until solved and when it happens you’ll get all the extra money you might have payed in taxes in the beginning of your employment.

Learn more about emergency tax here.

Find here an Excel spreadsheet to help you simulate the amount of taxes you have to pay.

Debt: The First 5000 Years by David Graeber

Every once in a while I read a book that feels like opening a windows to the world, insofar as reading books about our world, presumably (can be debated, in another day) increases our knowledge of it, since apart from the oral tradition it has consistently been the best way to transfer information through the ages.

Debt is one of these books. Written by David Graeber, an anthropologist by trade, it delves into the History of Humanity and explores relationships about debt, money, slavery, war and capitalism. This is not, by any means, a light book, since it has an extensive bibliography and many notes, but the good news are that it’s very well written, to the point that I don’t feel like I’m reading a university worthy tome (it certainly is). I actually came out the other side feeling like this can probably belong on a curriculum of books that everyone should read. It’s also a book that should prove it’s value on a reread, since many of the concepts and relationships that the author uncovers will take some time to settle.

The author starts by examining the story of how debt and money came to exist. Typical assumptions have that primitive economies worked on barter and trading goods directly, and that only when this system outgrew it’s boundaries people became concerned with creating artificial instruments to carry value (i.e. money, usually in the form of coins) and when these were developed enough, more complex financial instruments such as credit and debt came to be.

Barter -> Money -> Credit -> Debt

What the author exposes is then, an inverse of the traditional story. What if the reality is that debt came at the very beginning and is the root of all economies? An example of this can be evidenced by the fact that the Bank of England, one of the first central banks in the world, came to the be after a £1.2 million loan from a group of wealthy bankers to the then King.

In a fascinating journey throughout all corners of the world, we learn about how the Abbasid Caliphate had a standing army of slaves, and how the Islamic souks could well possibly be the original free markets that libertarians today talk about. We spend some time in Medieval China too, where we learn about Buddhist monks that used financial instruments in their temples to the point that we would now call them corporations.

The author identifies periods of History which alternate between virtual and bullion currency, that is periods where systems of credit were the main currency in use and periods where gold, silver and other metals were the main currency (or backing of that currency) circulating.

These major periods of History end in 1971 with the US president Richard Nixon announcing that the US dollar will be no longer redeemable in gold, effectively dropping what had become known as the gold standard. This recent age is then a mix of what happened throughout History, with no clear conclusion on what is going to happen, but the evidence of the last 40 years stands to say that the US dollar, the de facto world currency, is again a virtual one, but this time backed by the military power of the US:

“If history holds true, an age of virtual money should mean a movement away from war, empire-building, slavery and debt peonage (waged or otherwise), and toward the creation of some sort of overarching institutions, global in scale, to protect debtors. What we have seen so far is the opposite. The new global currency is rooted in military power even more firmly than the old was. Debt peonage continues to be the main principle of recruiting labor globally: either in the literal sense, in much of East Asia or Latin America, or in the subjective sense, whereby most of those working for wages or even salaries feel that they are doing so primarily to pay off interest-bearing loans.”

It’s a frightful ending to the book, but it’s not the only conclusion. There are many more the reader should be aware of, and not all as dark as the paragraph above. It’s a great read, and one that should get better with the years.

Ireland Budget 2017 after the dust settled

October 11th was Budget day in Ireland and with it new rules to learn and explore as usual. It’s interesting to note that the fast pace of our modern world (and economy) is reflected on this. I wonder if there ever was a day when we just took for granted that we would pay the same amount of tax, social security and get the same protections. I guess in the really old days the answers would be a lot, none and none, respectively.

I like to be a bit more meticulous and so let’s see what is new for people living in Ireland in 2017. The two biggest changes are the Universal Social Charge (USC) being lowered by half a percentage point on the lower three bands and a 5% tax rebate on first time buyers of new homes.

I plan to talk more in the future about the tax system in Ireland but for now I’ll highlight only these two points.

A bigger overview can be found here.

Most of the measures introduces left most of us very skeptic, especially in matters concerning the housing market crisis that is ongoing. Allegedly, prices on new homes have already risen since the Finance Minister officially announced the measures.

Overall, the tendency of the last two years to lower taxes is continuing, despite a slowing down this year. The 2015 and 2016 budgets were arguably more generous from this point of view. Ireland is still a very progressive system and these numbers, before the Budget for 2016, show that the lowest income people pay very little to no tax, while the tax burden falls on high income earners.

Another interesting point is that according to that article, Irish high income earners (characterized as earning 75.000 euros per year) already pay more effective tax than their Swedish counterparts. I’m not too sure about this, and I would direct anybody interested in this matter to dive on their own (one of these days I’ll whip up my own research about this). What matters though is that (as fame and my own experience would have it) the Irish taxpayer doesn’t get nearly as much bang for their buck as the Swedish one. We can dig into this in another post, but scratching the surface on things such as maternity and paternity leave, childcare and healthcare leaves us in Ireland way behind the Swedes.

Finally, I’ve added an Excel spreadsheet to calculate taxes in Ireland which offer more flexibility than traditional solutions found online, such as adding bonuses, voluntary contributions to pension schemes and passive income from dividends and capital gains. You can find it here.

Why should you be financially independent?

Today I’ll approach a subject that I’ve been researching the last few months, more in depth. I’ve toyed with the notion of being financially independent in the past, not because I don’t like what I do, as I am fortunate enough to have a great job which I actually like, but essentially because I like imagining what would happen if that was ever the case. You are considered to be financially independent when you don’t depend on a fixed source of income that relies on you having to work for someone, a certain number of hours, a certain number of days, for a long period of your life, or as most people would put it, a job.

Googling returns the following quote:

Financial independence is generally used to describe the state of having sufficient personal wealth to live, without having to work actively for basic necessities. For financially independent people, their assets generate income that is greater than their expenses.

Not having a job typically frees up time. What would I do all day? I’m an avid reader, does that mean that I could read hundreds of books per year? Would I get bored after a while? Would I finally set down the laptop and write a novel? Would I build a startup worthy project? Dust off my Japanese and read up on my stockpile of manga? And the million euro question, do I even need all that time to do those things?

The answer to this last question is, most probably, no I don’t. It comes down to prioritizing your life and doing only the things that are worth doing. Having said this, having all the time in the world wouldn’t hurt. I remember reading somewhere (I forgot where) that your best work comes out when you don’t need to get paid for it. For every person the reasons will be different, but there are discernible patterns emerging among all of us:

  1. Not having to work a typical 9 to 5 job
  2. Not being tied to a physical location
  3. Ability to travel more and having more time off

Let’s examine these three points in more detail.

Not having to work a typical 9 to 5 job

Once you’re financially independent, you really don’t need to work for anybody, anymore. It doesn’t mean you can’t do it, it just means that you’ll be able to live more “on your terms”, which roughly translated can be considered being able to not take any job that doesn’t connect with you, doesn’t pay enough for the troubles it creates or just sit back and not work at all. The main point is indeed, the fact that you now have a choice. And having that choice is what most of us fight for during our lives.

Not being tied to a physical location

This one resonates with me. I’m an economic migrant and have been one for a while. Coming from Portugal, a country that doesn’t really have many opportunities for good jobs or decent pay, I have been living on and off from my country for almost 7 years at this point. Between a brief stint in California and my current life in Ireland I wouldn’t expect going back to Portugal in the near future. Having the ability then to choose where to live, is very important to me. I could go live in other countries, stay in Ireland, retire in Portugal, who knows? Even though I like Ireland I wouldn’t mind living in other countries in the future. I believe living abroad is one of toughest things you can do in your life and at the same time (as with all hard things) it’s a great opportunity for self growth and discovery. Picking up a brand new culture, new language, new friends and landscapes will enrich your life and for me it runs the risk of being an addiction and not wanting to go back to the old life in my own country. The important thing then, is that with financial independence, I will have some wiggle room on where I choose to spend my days.

Ability to travel more and having more time off

It’s no secret I love traveling. Most people like it, so  I’m not in any way special or even different. Some like going to resorts, while others are more attracted by the backpacking style of it. If you have to work a job, independent of where you are in the world, you’ll have limited time off. Some of us have it better than others, but make no mistake, with a job comes a bunch of strings attached and one of those is pretty much the limited ability of doing whatever you want with your days (otherwise known as time off). I’m not even considering the paid aspect of paid time off, as most jobs might give you the ability to take time off without being paid, but in my experience those are few or next to none. In conclusion, then, being financially independent will allow you to take control of your holiday plans, which might not even include travel, it could be just spending a few weeks of the year relaxing with your family or friends.

And there you have it. Three reasons that I suspect cover 99% of the reasons why people decide to pursue financial independence and early retirement. There are of course a myriad of other reasons, some people want to spend more time bring their children up, others do it for reasons that are more in line with their ethos, such as rejecting a consumerism life style, but those will differ for each and all of us and in reality they are secondary effects of these main reasons.

As I mentioned before, a secondary effect, if you want, of having more time off, is that you can use that time to actually just…work. Like I mentioned before, maybe there’s a side project that you always wanted to work on, or maybe there’s a passion that you want to turn to full time job and earn a living at. Once you buy that time, you can do it.

In the future I’ll talk more about the why, but mainly the what and how of financial independence, with some details that I hope my European audience finds interesting, so stay tuned!