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The goal of software is to get out of the user’s way. Software, and technology in general, is designed for helping the user do their job, and do that without noticing the technology in the progress. Users don’t want to worry about configuring, setting up, or dealing with the overhead of a tool.

“Oh, I can change the color of the text to magenta and make the font Scary Halloween? Terrific!”

“You’re saying I can arrange all of the fields on the page in any order I like? I feel like I’m back in grade school playing hide and seek again. Thank you!”

“I have seven options for how I can message my friends? Lucky me!”

Developers get pumped about new features. They love the idea of solving a new problem in a new way. However, I then usually end up saying something along the lines of, “I know you like the idea of making this piece of software so generic that the user can configure it anyway she likes, so it can do anything she wants, but then she’ll pay for the opportunity to poison your food and kill you as slowly as you’re killing her with your software.” Developers are trained to generalize their code and make smaller gears that do more, but, this generalizing of code tends to make them generalize the users, or the user’s tasks, too much.

Since programmers live inside the code, they put most of their thought into the code, and all the stuff that falls outside of that (user interface and interaction) gets a cursory glance. It’s great that you can produce a report in half the lines of code, and with that same code produce ten more reports, but that’s not so great if the user only needed that one report. If a function that took the user two clicks, now takes them five just so they have the option of doing more things, then you’re not giving the user a win.

It’s not just about simplicity. It’s about getting out of the user’s way. Removing visual objects decreases the choices a user has to make. Those objects might not even do anything like displaying static text, which seems nothing like the choices a button offers, “Should I click this button and perform its action or not?” Visual objects, even ones that don’t require interaction, still require the user to make a decision, “Should I pay attention to this?” The more the user has to ask that question, the less impact your visual cues have. Ever wonder why the users keep missing that one feature or option that they keep asking you about? Important things need to be obvious, which means making them big, bold, and attention whores. However, this task is made that much tougher in a crowd of ten versus a crowd of two.

The more objects there are the harder it is making any single one stand out, especially at the specific crucial moment when user needs it. But that doesn’t mean that the software needs to get in the user’s way by jumping up and down and throwing around blinking fonts. If each piece is fighting for the user’s attention, then the user will mentally tone them down. This process costs the user mental processing power. As a developer, though, you’re job it maximizing user mental power by focusing them on those tasks that only they can do, and not on the things your technology does well. You’re reward is the user forgetting to thank you because they’re caught up on something else other than talking about your software. Users talking about software usually means users bitching about their problems with your software. Make them do that to your competition, not to you.

Let me close with two real examples. The first is a simple one, a web page for a rowing club for signing up members, posting new updates, announcing new tournaments, showing pictures, etc. In doing a redesign, many technical advancements were made. However, navigation went from a sidebar of about 4 sections with 4 sub links each, to a side bar of about 8 sections with 8 sub links each. And, not only were there more links (without any substantial new content), but the sub links had a really “cool” hiding feature that hide the extra links as the user clicked to open another section.

Nothing against hiding extraneous options or content (hiding options is getting out of the user’s way right?), but when one set of links was opened the other hide themselves, and if the user wanted to jump between two sub links, then they’d have to keep opening up the previous section. Not a huge task you’d think, but users are worried about the page they’re looking at, they don’t want to spend time remembering where you hid a sub link. That reduces mental processing power by diverting it into the software, and requiring the user to manage the software’s links instead of managing the task at hand. I would’ve preferred seeing (I wasn’t managing this project) 3 sections with 3 sub links that flowed the user through their tasks instead of leaving steps open to users.

Users want to do stuff, they want to accomplish tasks, not contemplate options. This is exemplified in this last situation. We’re redesigning our flagship application (the other project was a smaller consulting job, which we do from time to time for certain groups). It’s a full blown (web based) application with complex business logic dealing with budgets and financial decisions and such, lots of moving parts. We offer a base vanilla package, but we customize it for the user based on their business practices. There’s only so much you can generalize.

It’s a friendly relationship, we connect with our clients on a personal level and help them do their jobs better, faster, and easier. We see the relationships we build as a selling point when negotiating with new clients along with our ability to customize the software to their specific needs. Most of them come to us specifically because they want to kill their own IT, and we do what we can to make them love us.

However, from a managerial and technical point of view, the more flexible and customizable the software, the less time we spend developing client specific features and fitting it perfectly to each clients. Development time costs more than sales time for us, so in theory, it sounds awesome if we could create an application that we just hand over to the user, and let them configure it 10 different ways for every need, and we move on finding more clients. Everyone’s happy, right?

Except we aren’t hired to give the user options and ways to configure our software. We’re hired to make their processes disappear in the ease of using our software package. There’s this continual fight I have to put up with both management and developers to keep the software from going in this direction of ubiquitous hell. “You can do anything you want,” sounds great, but when we know those two thing they want to do, we need to make sure we do those damn well, and forget everything else.

The engineers say they’re trying to re-engineer the processes, they’re adding more power to the application. Other management thinks we’re saving developer time, cutting costs, and giving us more time to focus on new revenue. In the end, if we were to make the generic putty mold of our dreams, then we’d alienate and frustrate our current clients, and scare away future clients. New features are an easy sell, but bad experiences are turpentine splashed on happily painted walls. Experience is a hard sell, and customers understand the value of good smooth interaction with software they’ve never used less than your salesmen understand the code behind the shit they’re selling. But, it’s the glue the keeps people around and magically attracts more people as well.


“I hit the wall, and it wasn’t pretty. On the way back home from a work trip, I was walking down the aisle of the plane and passed out. Next thing I knew, the plane had landed and I was in a service area off the plane with soiled pants.”

“So, I was sitting next to this guy on the plane that was almost exactly like me – minus a few years. A veteran salesman who travels around for work a lot. High stress job with high demands. He told me his story of hitting the wall, and I know the feeling because I’ve come close myself. I can tell you all of the symptoms. I should teach a seminar on dealing with it.”

“Really you should teach a class on something you can’t fix yourself?” I rhetorically replied.

The above conversation is a shortened version of a story that an older friend told me. We laughed about it at the time (defensive mechanism or something?), but it’s a pretty appalling story. Frankly, anytime a person hits a mental or emotional wall that physically forces them to shut down it’s tragic, and I have a list of friends headed in that direction. Few seem able to stimulate the change needed to correct course, though.

In case you’re wondering what this has to do with financial complexity, I’ve been trying to figure out how to address other issues around the money life cycle beyond just money management issues. It’s easy stressing that single point because it’s so common for so many people, but money management is also almost the least important part. Money management is as much about money as it is change management, and that’s something everyone has problems with, which money can’t inherently fix.

So, this hitting the wall story is pretty bad, especially when your friend can relate so closely to the person telling it. I have mixed feelings about how to react to these situations because I’ve got a specific view that most people don’t care to hear. It seems like most people just like to complain, and prefer ignoring the next step – fixing or improving the situation. I always try and gauge if someone’s open to hearing what I actually think, but I’m hearing complaints so often, I tend not to care anymore.

I’ve got a great life, and a job that I really enjoy. I like to stress living a balanced life, but personally I hope to live an unbalanced one. One that’s unbalanced towards good situations and away from excessive pains. It’s really easy to do actually, but so few people seem to get this. They’re afraid and feel trapped either because they feel limited in options – either not having options or having options that just won’t work. I have a habit of saying that I’m lucky, but that’s bullshit. I’ve planned this – in a way – so I get easily annoyed when others complain because it doesn’t usually take much to improve things, but as I’ve learned, it takes more than just wanting to change.

You can see the wall coming at you and you know that you don’t want to hit it, but then why do you keep working long hours, taking on more work than you should, flying around on errands for you boss, making excuses for why you can’t change? That really sets me off, but I usually (less so each passing day, each passing complaint) hold back my reply because it doesn’t seem to affect people (so I’ll rant a bit on my blog). It feels hypocritical someone telling a person such as myself that you can’t change when I’m a great example of successful change.

As I said, I planned this. I didn’t plan the exact address or complete picture, but I set out with my values and needs, and I found the situation that would fill them. Those adjust with time, so I’m always on the lookout, checking my internal gauges, to make sure I shouldn’t act again. I don’t settle for mediocrity, and that’s easily the biggest mistake that people make. You don’t have to fight the fight in every part of your life, but it’s almost magical how everything falls together when you make sure that you’re at least fighting the important fights and taking on the meaningful challenges.

However, life isn’t a set of challenges and obstacles to outsmart. That’s another thing my friend said when he told me the hitting the wall story. It makes sense coming from him, a person with a special forces military background, that he sees life as being solved by outsmarting it. It just makes me want to scream, “Life isn’t something you can outsmart. Life just is.” You can plan for situations, and adapted to different problems, but life isn’t an obstacle course that’s set against you, which you can then overcome. Shear force – accepting longer work hours, more demanding work situations, or whatever else – doesn’t break you through to the other side. There is no other side, only that which you’re at now and where you’d mentally like to be. More of the same, or less of the good, isn’t outsmarting an obstacle.

Of course, none of this is all that complex. Most people who want to change know what they want to change, but not how. My friend thinks that he can keep from hitting the wall by going to an annual three day decompression camp, but years – decades – of built up stress isn’t solved by decompression camp when you’re that far down the road already. And my other younger friends think they can keep from becoming like the other, but they’re in the same environment, doing the same things, surrounded by the people they hope they won’t become, and assume that time will make things better or that they can just cut of at some point in the future. “Riiiight,” is all I say. That’s why you’re dad and his dad are workaholics.

You have to push yourself beyond the wanting stage. You have to expect better and demand better. If you’re consistent at that, then you escape from life as a set of obstacles and walls to dodge. You move into a state of flow like finding flow on the soccer field or at bat on the baseball diamond.

These changes and improvements will follow you into your money situation. You might not become the richest man alive, but you’re view of what you need and how you’re fulfilled will change, which usually means you’re happier with less because you know the few things that actually matter. So, if you know you want change, but can’t, then figure out what actually matters to you, and if your values don’t match your environment, then you’ve probably got some clues now what needs to change.

sit’n cool

[Disclosure: I received a free copy from the publisher.]

This is a book all investors should own, especially if you’re looking for a place to start learning. If you’ve been a part of the indexer crowd, then it won’t reveal any surprises, but it’s a good quick read at just over 200 pages that re-enforces a basic, simple, common sense understanding of investing. John C. Bogle, founder of Vanguard Group, has written a book that should help beginners see what their options are and how to go about investing, and it should also help anyone experienced with investing, but wanting to understand the enormous advantages of index funds. The one fault I have for this book is that it’s missing a major section of the investing population as it’s written at an audience that already considers themselves investors. Although, it’s probably expecting too much from any book to cover so much ground for such different audiences, so that shouldn’t stop anyone from picking up this little book.

As the book progresses each chapter covers a little more information on investing, but there’s one basic theme throughout all of them – low cost, cap weighted, index funds will provide you with the simplest and most guaranteed return. From the first chapter, which highlights the problems with the current investment industry through a parable about the Gotrocks family (a story adapted from one told by Warren Buffett), to the last, you’ll have a hard time dodging all of the facts thrown at you like balls thrown at a high school principal sitting in the school fair’s dunking booth. Actively managed mutual funds just don’t have a chance, and each chapter makes that more obvious from multiple angles. Again, nothing surprising for anyone who’s studied up on index funds, but it’s nice having that reinforced by John and the many successful investors, professors, and business people that he quotes in the book at the end of each chapter.

All of the praise aside, I’m still waiting for a heavy weight in the industry to reach out to the smart savers. Those people who don’t consider themselves investors as they’re just putting away some money here and there, not watching the market, but still putting a portion into investments in the market like a 401(k) or a Roth IRA. They understand that a return matters, especially compounded return, and that a savings account doesn’t compare to an equity fund. Still, they’re looking for a simple and safe option that lets them step away and concentrate on their life and not day to day market events, which is why index funds are just right.

Both audiences use the same strategies and have the same options (index funds), but they approach the topic from different point of views. Either way both would benefit from reading this book. Showing this is my favorite line from the last chapter, What Should I Do Now?. It’s spot on for this blog as John writes, “You must now be as exhausted as I am by the unremitting pounding of my theme that simplicity is the answer and that complexity simply doesn’t work” (p201) [emphasis added]. After reading through this book and understanding the very basic “arithmetic of investing,” there shouldn’t be much question about the validity and proven success of this simple strategy.

Recommendation: Buy it now.
Pros: Easy and fast read packed with loads of eye opening facts.
Cons: A good starter and intermediate book on investing, but still not aimed at the smart saver. It’s all about investing and money, and nothing about the investment life cycle beyond the investment itself.

* For those looking for even greater insight and a good second phase after you’ve read John Bogle’s book, check out a copy of Richard Ferri’s books, especially All About Asset Allocation or All About Index Funds in the side bar links.

money judgement

The eternal struggle of when to sell stocks and funds has hit home for me. While we’d like this process to be very mechanical, it’s actually very emotional, and that can be dangerous if you aren’t able to control your emotions. Here’s a simple guide to help protect yourself from making silly mistakes or becoming overly emotional (I first set out two rules, then turn them into one rule).

My story is that I’ve been planning a trip with a couple of friends to vacation through Southeast Asia, and it’s about to happen – we’re buying tickets now. One of those friends flies out frequently for work, so he knows the area relatively well, and has a made a number of friends and connections that can help us when we’re there. So, I need to free up some cash so I can buy the tickets as I keep as much as I can invested (and growing) until I need it.

Selling some portion of funds to pay for this, which I’ve been planning, so I know I have the money saved, makes the when-to-sell question quite easy. I sell when I need it, which is rule #1:

Rule 1 – Sell when you need it, not when you don’t. You invest your money for a future purpose, so you should sell when you need to take an action. Remove the environment of the market from the equation as the market doesn’t react to your specific situation.

Now, I hadn’t set a date ahead of time for selling because the plans haven’t been set in stone until a few days ago. The best way to go about this, as it removes as much emotional reaction as possible, is to pick a date as much as a week or two ahead of schedule, and set it in stone through some auto sell-by-date option. You should be able to set a sell date when setting up the sale, but in my case, I just said sell now.

To my fortune, the fund has gained a few percentage points in the last couple of days because the market seems to like the fact that a regularly scheduled FED announcement said they wouldn’t raise interest rates (and probably for a few other reasons too). Had I focused too much on this coming announcement, I may have tried to sell early because I expected bad news, or I might still not want to sell as I planned because I’m reacting to what the market did (either hold longer if I expect more gains, or hold longer because I want to recover from some loss). As you can see, I’d no longer be focused on the reason I actually want to sell, which is my trip, but instead because of expectations I have with the market – expectations that I have no control over or real way of understanding (beyond flipping a coin).

Rule 2 – Don’t plan your sale around short-term shifts in the market. The market doesn’t move around your life plans, so don’t plan around the market. This is when you get emotional because you don’t know what will happen, and worrying about short-term gains (or losses more often) will only lead you into a lose-lose situation. You already have a good reason for selling, so keep your eye on that.

Since this is a blog about removing complexity, and keeping personal finance simple, I’m stopping at 2 rules, and really it could be one rule:

2 Rules as 1: Selling is about planning, not reacting, so sell for a reason like needing the money for a specific purpose or regularly planned rebalancing (if you do this). With the exception of catastrophes (and even then probably not), don’t planning around market expectations because they will bite you in the butt.

To finish, lets assume that I let my emotions take over, and I sold based on my market expectations, and lets also assume I lost money by holding onto the fund after the announcement. Now, I’ve been scarred by this. Humans hate loss, and we do what we can to protect ourselves. Next time there is an announcement, I might feel anxious and want to sell for no reason other than avoiding a temporary loss, which actually costs me money in transaction fees to move the money around, and that’s a loss in itself.

If you go down the road of reacting to the market, the short-term market, then you’ll start to become like many of the traders I used to know who would get anxious, maybe even losing sleep, about potential loss and overconfident about gains both of which they had little control over. Even trying to predict the long term market has big risks, which is why holding the whole market is in most cases the best option (in both risk and return).

success key

It’s been a little while since I last posted (been sick part of this time), and my last few posts have been a little heavy, or involved, or however you want to describe them. So, to get back to the basics and just keep it simple, here’s a simple reminder of what personal finance is all about.

At the end of the day, it’s all about you, not a number in your bank account(s). It starts and ends with you. You hopefully work at a job that you like, and that makes you some amount of money that’s more than you need to spend. With the money left over, you put some of it into a checking or savings account. As that amount grows, you move some into a retirement account or into an investment account. Both will use index funds as an investment option, and later on down the road, at retirement, or when you buy a house, or make some other purchase that needs this money, you cash out.

That’s it. That’s the whole system easily summed up in one short paragraph. You could get a little more detail on the index fund question, but you go out and buy the whole market. Don’t mess with the extra costs, risks, and complexity of doing it any other way. Maybe you tweak how you buy the whole market, and include different allocations of bonds and equity such as with a mix of US and foreign equity, but you’re not picking and choosing winners and losers. You’re picking a very competitive market return (a better return than from active mutual funds, or picking stocks yourself) with low costs and an easy conscious.

The hardest part of this is planning your future. What do you want to do, and what do you need to do it? Your money only supports your lifestyle, it doesn’t choose it. You can easily make this more complex, but why? That really is all you need, and maybe you have one index fund period. That makes where you put your money beyond easy, it’s brain dead. And then you really focus on being able to save and invest in that one fund. You worry about what you’re planning on doing with the money, and not what your money does. That is simple, elegant, and beautiful.