Financial literacy enormously reduced worries about things like retirement and buying a house which increased my risk tolerance which lead to me working on projects that I actually care about.
Also, betting on things continuing to get better contra all the doom and gloom that is mostly generated by class tensions between the American middle class and upper class (using moralizing about the lower class as a weapon/distraction) who are both absurdly well off. Expecting to retire abroad because retiring to the US is too much a random gamble given health care costs. Also things like not expecting children to cost much money because I don’t think spending money on education accomplishes anything (outside the scope of financial literacy per se, but affects things a lot). That and some various FIRE tropes decreases magnitude and variance on expected money spent to achieve a given level of well being over a life time.
I’ll springboard off this. I currently work as a financial planner (in New Zealand) and one of the exercises I go through with clients is to “flawcast” their financial future—ie, look not just at their current financial situation but at their financial trajectory, making various assumptions. There’s enormous sampling bias (as only wealthier people tend to receive advice) but for a lot of these people they realise that they’re on track to achieving their financial goals—and they have a lot more options in life than they thought. For example, spending more, working less, retiring earlier, trying something different in their professional life, providing more assistance to loved ones and/or causes they care about, continuing to work but with the knowledge they’re doing it because they want to and not because they have to. Independent of any substantive advice I give, this is usually what gives them the most confidence and comfort and value out of the entire process—even though it’s a pretty basic mathematical exercise. (FWIW these are usually clever, switched on people but they haven’t looked at their finances in this future-focused way.)
Financial literacy enormously reduced worries about things like retirement and buying a house which increased my risk tolerance which lead to me working on projects that I actually care about.
Sounds interesting...could you elaborate a bit as to why one should worry less? Do we overestimate the importance of buying a house for retirement?
https://www.lesswrong.com/posts/X7G3HfRuMzCSBzgbM/87-000-hours-or-thoughts-on-home-ownership
Also, betting on things continuing to get better contra all the doom and gloom that is mostly generated by class tensions between the American middle class and upper class (using moralizing about the lower class as a weapon/distraction) who are both absurdly well off. Expecting to retire abroad because retiring to the US is too much a random gamble given health care costs. Also things like not expecting children to cost much money because I don’t think spending money on education accomplishes anything (outside the scope of financial literacy per se, but affects things a lot). That and some various FIRE tropes decreases magnitude and variance on expected money spent to achieve a given level of well being over a life time.
I’ll springboard off this. I currently work as a financial planner (in New Zealand) and one of the exercises I go through with clients is to “flawcast” their financial future—ie, look not just at their current financial situation but at their financial trajectory, making various assumptions. There’s enormous sampling bias (as only wealthier people tend to receive advice) but for a lot of these people they realise that they’re on track to achieving their financial goals—and they have a lot more options in life than they thought. For example, spending more, working less, retiring earlier, trying something different in their professional life, providing more assistance to loved ones and/or causes they care about, continuing to work but with the knowledge they’re doing it because they want to and not because they have to. Independent of any substantive advice I give, this is usually what gives them the most confidence and comfort and value out of the entire process—even though it’s a pretty basic mathematical exercise. (FWIW these are usually clever, switched on people but they haven’t looked at their finances in this future-focused way.)