Minimalism Rulebook

Being an engineer, a data analytics guy, and then a strategy professional, I strongly believe in finding a proper method or framework for doing things, instead of following a "hit and trial" method. 

When I started my learning journey about minimalism, I searched a lot on google for finding a Minimalist Rulebook. I honestly believed that there should be a set of 10-20-50 rules that you need to follow to become a minimalist. I scoured a lot of websites out there, subscribed to their email lists, and downloaded many free PDFs that they offer. However, most of them turned out to be guidebooks on How to declutter your life. 

Well, most of them were good for that purpose, but decluttering is only a very small sub-set of a minimalist lifestyle. No doubt it is the most visible part, but eventually, it is only a sub-set of the overall philosophy. Also, instead of all those long PDFs, I rather prefer to go and read a 15-word blog post from The Minimalists 

The easiest Way to Organize Your Stuff … is to get rid of most of it.

Umm, so there is really no rulebook?

Dan Dimmock on Unsplash

The more I study about it, the more I realize it is not only inaccurate but quite pointless to have a minimalist rulebook. 

Minimalist living is not about who can lead a normal life with the least amount of possessions. Rather, it is about owning or being attached to things consciously. Own 100-200-300 things, but each one of them should add value to your life. However, what adds value to my life could be absolutely useless for you. Context matters. For example, I love tea and own several pieces of tea-making ingredients and equipment. But in a coffee drinker's life, all of this is just clutter! 

To add to it, I realized what adds value and what doesn't is a point function. Meaning, it is true only at a given point in time. When I shifted to where I live now, I carried my Xbox thousands of kilometers with me. I could not imagine a life without it. However, today morning I found it stuffed at the back of a closet, untouched since almost a year ago. 

So what should we do?

In any dictionary, Minimalism is not written as the opposite of the word Want. Rather, Minimalism is defined as the process of owning things more consciously and questioning the value of things we still hold on to from the past. 

From my personal experience, what works better for the human behavior is defined, scheduled processes than rules or my pet peeve - new year resolutions. Taking an example from my other passion - personal finance - 

• Process: Following a Systematic investment plan (SIP) or Dollar Cost Averaging (in American parlance) is a great process to automate long term savings while making sure the amount earmarked for savings is not used for wasteful expenses - you can't spend what is already deduced from your account
• Changing context over time: To assess if your current investment profile still aligns with your long term values, it is recommended to periodically balance your exposure between different asset classes (debt / equity etc.) once a year or so

Similarly, for the minimalism practice, each one of us has to answer our own questions and develop our own processes - 

• How do we decide if a thing adds value to our life or not?
• How do we make our purchase decisions?
• What to do with just in case items in our home and life? (the drawer filled with 50 different screws and 20 different chargers and wires!)
• How do we learn to co-exist with family / friends who do not believe in minimalist lifestyles?

and so on...

Once you have clear answers to such questions, you will realize that you don't really need a Minimalism Rulebook. All you need to do is 

• remember these key values before making any purchase decision in life / while periodically reviewing your possessions
• revisit these questions periodically, to evaluate if your answers have changed  

 .. and that is how you truly take your first steps in adopting the minimalism philosophy. 

Till we meet again - Au revoir! 

PS: Do check out the Books page on the blog [Link]

Hedonic Adaptation

I am currently following a course on Coursera: The Science of Well Being. It has been one of the most famous online courses by Yale, to date, and my favorite so far. If you haven't checked it out, I recommend you do it. 

There is a concept discussed in almost every lecture 'Hedonic Adaptation'. Which, simply put, states that 

On average, a person's happiness remains almost linear throughout his life. We get used to everything.

We envision, that a big positive event such as buying your first car will make you really happy. Well, it does, but only for a few days. Let's say till the new car smell wears out or you get the first scratch on the bumper. 

On the other hand, we envision that those big negative events will make this life a living hell, well guess what, we get used to it as well. Do you remember the paranoia in April-May? Everyone was refreshing Worldometer 20 times a day, washing groceries with dish soap, and even crossing the street if you spot a pedestrian walking your way! ... and now, almost no one seems to care! 

Image Source kadampalife

Hedonic Treadmill

It is the exact same reason the concept is also referred to as the Hedonic Treadmill. We are running on a treadmill, trying to maintain the state of euphoria by chasing Instagram likes, buying new things, searching for those 15 minutes of fame. But alas, this survivalist brain of ours brings us back to where we started.  

I read a very interesting example today about this - We can now purchase and download all our favorite songs on our phones and can, and actually do listen to them whenever we want. But does it give the same burst of excitement if the song unexpectedly comes on the radio or you hear it being played in a car passing by?

This example can really be tied to the age-old adage that we hear from monks and minimalists. Experience over Things.   

Once you own a song, after the first few times, your brain knows it resides in your pocket, and you can listen to it anytime. Meh. Takes away the excitement. While, as is the case with all experiences, listening to it on the radio is a once in a while event, can not be done on-demand and actually has a surprise element to it! 

Can we alter the baseline?

I often found myself asking the following two questions during the lectures:

How did my happiness / life satisfaction baseline get set to a specific level? 

To be honest, I didn't find much conclusive answer to this question. Some studies say almost 50% of the weight is on genetics, the next 10% is on the conditions you have grown up in, and the rest 40% is what kind of personality we have, our thoughts, values, and so on. I figured, the baseline doesn't matter, if I can find an answer to the second question 

How do I play around with it? 

 Professor Laurie Santos gave several good pointers, but the following ones struck a chord with me. 

• Savoring:  The act of stepping outside of an experience to review and appreciate it 

While having an experience, step out of it and realize that this activity was probably your dream for years, what seems like an unordinary thing now

• Gratitude The quality of being thankful and a tendency to show appreciation for what one has 

Sounds like a small thing, but writing down 3-5 things every day that you are thankful for increases your happiness baseline for weeks! And sharing your gratitude with a person can yield months of increased baseline. 

And this method is Dwight Schrute approved as well 

And the last one, which was quite a counterintuitive one for me. Interrupt your positive experiences, and savor them by enjoying them in multiple sittings.

I actually didn't understand this one quite well, till I heard the subsequent example: Were TV shows much more exciting when we had to wait 1 week for the next episode, which was even further interrupted with advertisements? Or are they more enjoyable now with them playing in such uninterrupted mode than even Netflix has to ask - Are you really still watching this show?

Ending Notes

I still have about 3 weeks of the course to go. Will add here or in a new post if I find more such interesting nuggets. For now, I will leave you with my favorite quote of the week.

A new car sticks around to disappoint you. But a trip to Europe is over. It evaporates. It has the good sense to go away, and you are left with nothing but a wonderful memory. --Dan Gilbert

What is minimalism?

Like most of you, I spent the better part of 2020 in my pajamas, wearing the same 4-5 t-shirts throughout the lockdown and wondering about a lot of existential questions. Obviously, after exhausting the whole catalogue of Netflix. 

With an extra 2-3 hours extra per day, thanks to reduction in travelling time - to and fro from work - I was able to dedicate a lot more time to reading. In addition to the usual financial markets stuff, I was forced to read a wide variety of topics just to keep myself engaged. 

To my surprise, one of the topic that stuck started with reading en vogue book of the year by Marie Kondo. Though I also read a lot about the first principles behind it - the Zen way of life, minimalism, meditation and as Po would call it "inner peace". The only one that stuck was Minimalism.

To be fair, we are not monks. We cant renounce stuff and live life like master Oogway. We must take what is good and practical to apply and enrich our life. 

So how do you actually define Minimalism?

First I present you the definitions from the learned ones, and then mine.

 

Maybe you don’t need to own all this stuff. - Joshua Becker's Neighbor

 

Minimalism is defined as a design or style in which the simplest and fewest elements are used to create the maximum effect. Minimalism had its origins in the arts—with the artwork featuring simple lines, only a few colors, and careful placement of those lines and colors - Andrew Ongaro 

 

Minimalism is a tool to rid yourself of life’s excess in favor of focusing on what’s important—so you can find happiness, fulfillment, and freedom - The Minimalists

 

It’s a way to escape the excesses of the world around us — the excesses of consumerism, material possessions, clutter, having too much to do, too much debt, too many distractions, too much noise. But too little meaning.  - Leo Babuta of the Zen Habits

My definition is a derivation from the work of all these masters, and my MBA degree - Dude, its just Pareto Principle. Only 20% is enough to get 80% of the results! While we know this for business world, it is equally applicable in personal world as well.

Photo by Sarah Dorweiler on Unsplash

Being a certified data nerd, I tried collecting some random samples to test this out

- We have 8 HDMI cables at home but only 2 ports in the TV

- Got 5 suits, but only wear 1 lucky one for all key meetings [not taking questions on this one]

- More than 50% of the contents of the wardrobe were not used in the last 1 year

- iPhone has actually unloaded 35 apps of the total 50+ on due to long-time-no-see

- Don't even remember where do I know from ~500 friends on Facebook

- Not even going to do the same exercise for LinkedIn - already know the results will be worse

... and a lot more 

Certainly begs a question or two?

1) Does it matter - Yes, it does. Believe it or not, most of us are dealing with a cognitive overload. Too many processes running at the same time, leading to less than optimum resources being provided to the essential ones. 

For the same reason you see most influential CEOs always wearing same clothes - less optionality, less cognitive overload for non essential stuff. 

To take an example from your daily life, the famous words of IT helpdesks - did you try restarting it? The simplest solution to complex problems, as it simply shuts down all unnecessary processes that the laptop started in parallel during the day! 

2) What should you do about it - I have no idea, what you should do, but here are some things I am working on

- Start discarding some of my possessions [ideal target is one item per day]

- Reduce stock portfolio to less than 20 stocks

- Try saying no to at least 3 meetings per week

- Reducing time spent / connections on social media 

... and some more

My goal is to try 30 day minimalism game, but that is a very hard one. As of now, I am on baby steps of the process :)

See you next time with more updates! 

Student Loans Endemic

First things first: In the past few years, no other image has brought me as much joy and mental peace as this one:

~~~Closure notice of my student loan account~~~

Ever since my graduation in June 2016, closing the student loan has been - you can say - my singular focus in life! While the loan payments were quite manageable for our household budget, just looking at the sheer size of the debt in 2016 used to nauseate me. 

Leverage

For those who have undergone any form of finance or business courses, leverage is usually one of the first topics that they learn about. In investing terms, leverage basically refers to the act of seeking higher profits by investing borrowed money (source). The courses then go into the detail of adjusting your extra returns with the cost of capital (interest) and the tax benefits you get on the interest paid. Net-net, on paper, it is a brilliant idea to leverage to grow rapidly - IF you have a consistent cash flow. Mind that IF in bold, underlined font. 

Leveraging, or taking out a student loan, for international higher studies course is indeed an interesting option, but considering the current economic conditions, increasing protectionism and volatility in general makes it the second most risky investment you can make in the recent times. First, of course, is investing in crypto-currency! Well, don't even get me started on crypto! 

Recently, I read some of the most beautiful words written about leverage (source)

Body size in biology is like leverage in investing: It accentuates the gains but amplifies the losses. It works well for a while and then backfires spectacularly at the point where the benefits are nice but the losses are lethal

Optionality

Along with increasing the risk, I believe, any form of regular, mandatory payment decreases your optionality. Especially in case of student loans, as your repayment term begins, you are forced to find a paying job, or let go of any start-up ideas that you were pursuing. While one may or may not exercise any optionality, it is always at the back of your head to be in a stable, secure life with cash flows exceeding loan repayments at the bare minimum. 

Having said that...

And, after closing down on the juggernaut sized loans, I can now say that this leveraged trade was one of mybest trades with quite high ROI. Not only I have changed my industry and geography (of the 3 famed traits that define your job: geography/industry/function), but it gave me incredible opportunity to settle down in the city of Paris! AND, that puts us in close proximity of almost the whole of Europe for mini-sojourns! 

In a nut-shell...

What I am trying to say is leverage is risky! If everything works out - awesome! But in most of the cases, it is taken on by students, in disproportionate amount vs. their own assets, and with no clear visibility on future cash flows. Compound that with volatile geopolitical and protectionist environment of today, it is not a figment of my imagination that student loan debt will be the next burst bubble, similar to that of 2008.

Let's re-learn!

A long time ago in a place far, far away, I used to have an interesting friend. One Friday evening, like any other Friday evening, we were chilling at our regular Theka, when suddenly he made an interesting proposition. Though in a very businesslike but suspiciously hushed tone. Only because I was his close friend, he wanted to introduce me to a business idea, where I just need to invest a small amount. The good part about his plan was that the returns would start flowing in in less than a month. The even better part about his idea was that soon after, I will have to do nothing and the so-called business will run on auto-pilot mode and I would be a sit-at-home millionaire!

Photo by Jimi Filipovski on Unsplash

I am very sure that the audience of this blog is smart enough to understand that his business-idea was the infamous Multi-Level Marketing scheme, and of-course that conversation is one of the key reason why the first line of this blog says, ‘I used to have an interesting friend.”

But this post is neither to discuss MLM schemes, nor about old friends. This post is about a simple question that I usually ask anyone giving me an investment idea or as it is better known as 'tip' – if your idea is so commercially viable, why do you want to share your riches with me? Why don’t you mortgage your house and invest in the business? If everything goes well, soon after, by just sitting in your mortgaged house, you will be the proud owner of 100 such (mortgaged?) houses! 

This is probably just one example, and that too a very crude one. But the deeper you dive into the field of investing the more examples you will find of people and even companies misselling and promising (mostly?) unachievable returns. And that’s where my friends, this line of thinking is helpful. If the cost of capital (plus transaction charges) is less than the promised(!) returns, it is probably time to ask some hard questions.

Although, I must warn you, that probably I am from the older generation where people thought about businesses which were profitable or had a break-even point, and did not plan to run on ‘funding’ till someone bought them over. But I digress…

---

A new Journey

In not so distant past, till I decided to quit my full-time job and pursue my MBA, I was quite engaged in investing as well as trading. However, to fund my education, I liquidated almost all my investments, and even spent a couple of years under heavy debt! Yep, the infamous student-loan!

As the loan was paid-off and closed recently, I am re-learning the process of investing, while getting acclimatized with the new realities of the trading world. As I learn, digest, think and process, I will try to jot down some of my thoughts here on this page.

May the bulls (& bears) be always with you... ! 

The one where it snows in Paris

In what should be a non-event for most of the people, it snowed in Paris this week. Oh boy, and it snowed heavily than what I have witnessed in past 4 years in France. And it wouldn't be an overstatement if I say, I have never seen Paris look so beautiful in my life!

View from my balcony

Being born and grown up in harsh, hot weather of Delhi, with blinding-foggy winters, I have had only a few brushes with snow in my life. My first encounter with snow was when I used to work in Romania. That got out of hand, pretty quickly. The whole town was covered in snow for over 3 months! Suffice to say I believe I finished the quota of snow-days for 24 years of my past life in those 3 months! 

The little town I lived in, Timisoara, had a different charm in the snow. Having an apartment and office in close to each other helped me a lot to discover new snow-covered ways through parks, central squares, near rivers and over the bridges - all while walking back and forth from work. Though I didn't realize it at that time, but the sentiment snow evokes in me is something as close as love as one can feel! 

The yearning I had, over the years, to see and feel fresh layers of snow never went down even a notch. To add to it, I don't remember where, but there was a scene in a movie (or a TV series?) where the actor opens his mouth to taste the pure taste of snow, as it falls, made me add that to my bucket list! 

And, I tasted snow! ...as it fell by buckets, in the shape of tiny feathers from the sky! 

I left for work at 5.30am couple of days ago, and it was snowing lightly. Though I hate to get up so early, not to mention venture out of the house at such ungodly hours, but what I felt was surreal that day.  While the world (and the Mrs.) were tucked in their Razais, I was the lone soul walking outside, with an ocean of snow in any direction I saw. Only to be punctuated by some iconic Parisian buildings. I was creating fresh footprints in the freshly laid snow, with no sounds except the one I was making while stepping on the snow clouds! 

To put it briefly, I witnessed and felt pure magic! I can write pages to describe what I felt early morning that day, and still feel that I haven't conveyed my feelings properly. But instead...

... I will take a pause here and wish everyone reading this to feel - every single day of their life - the happiness and magic I felt that day. 

THE YEAR THAT WAS: 2017

As I sit in the familiar comfort of my Razai with a warm cup of Chai in my hand, I couldn't help but notice that it has been 12 months since I smelled the aroma of a cardamom Chai mixed with Delhi's fog! We say this every year, but didn't 2017 just whiz by faster than we could imagine?

2017 for me can only be defined as the year of big transformations. The year that brought with it momentous changes, of positive nature, in both personal and professional aspects.

Photo by Szűcs László on Unsplash

Professional Updates

After completing my MBA last year, I toughed out 6-odd months in an internship, then 6 more months in a temporary contract (known in French as Contract Duration Determinée or CDD). However, at the beginning of this year, I was finally able to secure a full-time contract (known as Contrat à durée indéterminée, in short CDI) in a leading global firm. 

Having worked in India for the most part of my professional life, all these contract types were very alien concepts for me. In my previous jobs in India, the process flow was as follows - a company hires you (usually from the first contact to final offer, I have never spent over 4 working days), and then you continue working there till you retire, or you leave by giving a 30-60 days notice. The company can also fire you if they don't like your performance by giving you same notice or compensation for the same. 

However, from what I have gathered, it is quite hard for even private companies to eliminate positions or fire employees due to labor protections in France. For all practical intent and purposes - it is deemed nearly impossible unless there is gross misconduct. Hence, large companies usually require you to go through a trial period of internship or a temporary (fixed duration) contract before they can trust you enough to give you a full-time contract. 

While there is protection for employees (which a surprisingly high number of millennials in France seek), this whole process makes employers very cautious while hiring new people, leading to lack of liquidity in the market. Therefore, you will see people sticking around in the same company or companies having to keep the same people around for decades, even if there is a visible mismatch. Plus making it hard for new talent to get hired properly for a job fitting well for their profile rather than in a firm which is willing to give them a CDI. 

However, having decided to have built my career in France, I am adapting to the prevalent system, and happy to report my CDI contract to you guys. 

Personal Updates

This is the big one - After ~2 long years living on our own, while spending Friday and Sunday nights in Eurostar to travel between Paris and London, the wifey has now relocated to Paris! As some people are calling it - The Khannas Reunited! :)

With that, we have now commenced The Grand Tour of Europe! As our weekly shuttles between London-Paris have come to an end, we have decided to spend our travelling budget on visiting a new country every alternate month - or simply 6 or more new countries every year! 

In terms of cities, this year we visited the regular London, Paris, Delhi, and Hyderabad, along with new additions of Prague (Czech Republic), Copenhagen (Denmark), Champagne (France). Ghent (Belgium) and Lille (France).

We also spent a lot of time exploring the streets, museums, and gardens of Paris. On that note, I think we should cover the Parisian expeditions in a separate post. Something similar to Sahil's post on Paris hall of fame! 

Onwards! 

For 2018, instead of making several small resolutions - which almost no one ever keeps - I have decided to do six '30 day challenges'! I first heard about the concept in this Ted Talk and was quite intrigued by it. With several small life improvements and personal projects that I am working on in parallel, I think dedicating a month to each of them would be quite interesting as well as productive!

Keep watching this space for more info! Till then...

Wish you and your family a happy and prosperous New Year 2018!

I should probably write more of these year-end reviews: THE YEAR THAT WAS: 2014