Sofia completed her medical training and secured a top job at a leading hospital. Her first day brought a pile of paperwork. She glanced at the packet and found forms like:
- the retirement plan,
- a couple of medical, dental, vision insurance plans to choose from,
- life insurance,
- disability insurance, and
- W-4 withholding.
Lisa to the Rescue
Lisa from the hospital’s HR team helped her. She always gives financial advice to new employees. She began by telling Sofia about the three financial decisions she’d make that day.
Sofia first had to think about events like disability and death. Next, she had to account for health costs and shield herself from big medical bills. Finally, she had to consider retirement and decide her monthly savings.
Dealing With Uncertainty
Sofia wanted to choose wisely. But, like anyone, she couldn’t predict unforeseen events. But she had information about insurance costs and their coverage. This made her choice easier. A small monthly fee seemed worthwhile for peace of mind.
The next category was about healthcare and protection against sudden sickness. Lisa pointed out that the plans met ACA standards. She explained deductibles and annual limits. The choices were similar, so Sofia picked one that suited her health. Being healthy, she chose a low premium plan with higher copays.
Balancing Risks
For the third category, retirement, Lisa talked about the tax advantages of retirement schemes, particularly the hospital’s 403(b) plan. If Sofia saved ten percent of her pay, the hospital would contribute another five percent. Sofia saw the value in saving at least that amount.
Lisa showed her a chart about compound interest. Sofia understood its significance and the power of starting early. She wondered if saving for retirement would affect her house savings plans. Lisa said she could borrow against her retirement funds. Sofia felt reassured knowing she could save without disrupting her budget or future.
Lisa discussed the various funds in the retirement plan. She compared growth funds with US Treasury bond funds. Growth funds are risky but benefit from economic growth, while treasury bonds are steadier. Sofia knew about the long-term growth of the economy. However, recent market fluctuations concerned her.
Lisa assured her that market variations balance out over a thirty-year period. Sofia could invest in dividend growth stocks, which have been historically stable. Sofia decided to diversify: 30% in growth, 50% in dividend growth, and 20% in US Treasury bonds.
They completed filling the forms. Sofia felt confident about her choices, and Lisa felt proud of her assistance.
Lisa’s Role
Without Lisa, Sofia would have struggled with the forms. Some were tricky, and even simple ones required understanding economic patterns and market behavior. Lisa, with her years of experience, knew this. Here’s how she helped Sofia:
- Lisa sorted the decisions into three main categories.
- She explained fundamental concepts like compounding.
- Lisa detailed how insurance works and the basics of retirement plans. These First Principles clarify complex or confusing topics, making them more approachable.
- She identified Sofia’s primary objectives for the day. These are what we call “Tasks to be Completed”.
- Lisa understood Sofia’s concerns and dreams, tailoring advice accordingly. These are what we call “Aspirations to be Met”.
Project Organization
Lisa’s help to Sofia reflects the goals of A Simple Project. The project aims to simplify topics like finance and technology. We address the 3 Cs: complicated, complex, and confusion. We uncover their causes, find solutions, and devise ways to simplify daily life.
The project has two parts. The first three steps in A Simple Framework form the first part. They discuss the 3 Cs‘ nature and roots. You can find this content under Foundations and Framework. The second part focuses on the fourth step, offering advice. You can read about this in the Blog posts.
What Subjects Will the Project Cover?
The 3 Cs affect many aspects of life. Our project can’t address all of them. Topics like personal relationships are intricate. Our relationships with ourselves, with others, with spiritual guides, religious leaders, and even deities are too intricate to be tackled by a humble project. Therefore, A Simple Manifesto doesn’t discuss them. But our insights in other aspects of life can be applied to personal relationships. We’ll leave that exercise to the reader.
The project will explore fields like finance, economics, science, technology, and consumer products. It will use simple examples to show how the 3 Cs appear and how to counter them. We won’t probe every detail. Instead, we focus on challenges we face in our daily lives.
Politics?
We avoid politics. People have strong emotions about politics, and it can be as personal as religion. Media coverage intensifies feelings. Thus, we skip politics. However, we might occasionally discuss international geopolitics from a high level perspective.
The subjects we explore are vast. They have rich histories with layers of knowledge. A newcomer would need time to understand them fully.
Your Engagement is Crucial
The project’s authors will continuously add and update content. The blog will present bite-sized content. Topics may range from stocks vs. bonds to selecting coffee machines. As readers interact and provide feedback, the project editors may use that feedback to refine the Framework.
We hope this manifesto clarified the project’s aims and approach. We value your feedback. Engage with us and other readers in the comments. You can use a pseudonym and a disposable email to stay anonymous. We ask for email and name to combat spam.
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