- Strawhead Test
- What was your score on the Strawhead Test? What surprised you? What did you learn?
I scored 312 on the Strawhead Test. This score actually did not surprised me on a general basis. I know I am a strawhead. I actually don’t believe in suffering builds character before since I believe that when people suffer too much, one becomes more greedy and place too much importance on the material things, which is a not a healthy mind set to me. I score a lot in the movie part. I surprised that the professor indicates that watching movie is a wasteful of time and movies make people stop thinking. I am a bit disagree with this point. Whether you devote your time to a book or a movie, it is requiring a continues time of attention during which one actually lost and forgot oneself, connect with others’ thoughts and ideas and learn from others. Such a period of time gives one peace.
While, in reflection, I believe that the fundamental difference between strawhead and strawsucker is that they view life or the world differently, such kind of differences mirrored in their behaviors . The strawhead believes that one should be aggressive and work hard to achieve great material success. Enjoyment is wrong. While for strawsuckers, they live in the moment, they try to maximize the pleasure for the moment. They place more importance on spiritual matters. Being a total strawhead may be too tiresome and living in constant pressure, but being a total strawsucker may be too unrealistic and achieve very little in real life. I am on the strawsucker end. So I believe I should be more realistic and more down to earth, hold practical attitude to life.
- Identify three places where your spending decisions do not line up with your aspirations or goals. What are three specific actions you could take to “stop the flow” in these areas?
Thing one: I bought a very expensive shirt in a concert of my favourite singer and thought I would wear it to sleep everyday. But the texture is not that good I never sleep in it ever. I could be less emotional when making buying decision and be more particle.
Thing two: I deposit a certain amount money to a store. Then to spend the money, I kept going to the shop bought a lot of unnecessary items. I should realized that if don’t go to the shop, I may not need to spend the money on unnecessary items.
Thing three: I bought a gym card for 500$ for a year period. I only went there three times. I could spend the money on private coach class instead of buying the card, at least. I could get some real training from attending the class.
- Experience vs. Things
- List three major material acquisitions and three major experiences you have had in your life.
Material acquisitions: 1, a piano 2. iphone 3. Mac
Three major experiences： 1. Travel to Japan 2. Interpretation part time job 3. participating in summer camp
- Now, looking back, reflect on the happiness/satisfaction that these acquisitions and experiences have had on your life. What conclusions can you draw going forward?
With piano, it is kind of dream come true for me. I always want to learn to play piano. It satisfies my long time desire.
With iphone, it makes my life so easy. I could do a lot on phone, keep connected with friends and families, read, watch video and so on.
With Mac, I do my homework on it and do more complex task which my phone can’t perform.
For travel to Japan, this trip is really eye opening. I travel with my friends. This trip gives both us a very precious memory.
For interpretation part time job, it provides perspective for me of a work life. It taught me what is it like to be professional and gave me opportunities to do networking.
For participating in summer camp, I made a lot of good friends and learned how to get along with others.
As for material acquisitions, it does provides a lot of convenience and I was thrilled when I first got them. But gradually, I tend to get used to having them. I just take them for granted. For experiences purchase, you can savor the experience after it ends. Also, the experiences gave you topics when talk to new friends. The experiences broaden one’s life and actually help to build one’s character.
- Money
- If you invested $10,000 in the stock market at 8% return, how long would it take to double your money? How much money would you have after 45 years?
It would take 10 years to double the money. After 45 years, I would have $319204.49.
- How does a Roth IRA work? When will you start one? What will you invest in?
The Roth account only accepts after-tax deposits rather than pre-tax deposits. However, if you keep deposit money in the account for continuously full for five years or more, all withdrawals after the age of fifty-nine years will be tax-free. You can invest your Roth IRA account deposits in stocks, bonds, and other financial instruments at same time. When the money is left to the next generation of beneficiaries from the account, investment profits continue to be tax-free, and investment can continue to grow without restrictions.
When I am 45-year-old, I and my spouse each can save 50,000 U.S. dollars each year in the SEP IRA, and then immediately switch to the Roth IRA, for 20 years, the total principle would be two million dollars. I would choose the most active investment tool (such as ARTKX ). Assuming an annualized rate of return of 15%, retired at the age of 65, the principal of 2 million US dollars has already become 10 million US dollars and is completely exempt from income tax. These tens of millions of US dollars in assets, in addition to for the use of retirement, could leave to the beneficiaries of children or grandchildren, investment profits continue to be exempt from income tax.
- Ethics
- What was your answer in the Thrifty VP exercise? Explain your thought process? Based on class discussion, what is your price to do something dishonest where you risk termination of employment—but not criminal prosecution?
I would say no and report them, because this is the right thing to do. It does not matter how others think, when something is wrong is wrong. Plus the possibility of retaliate would be very small. $ 100 million
- In class your instructor argued that it was in your selfish interest to be ethical. Explain the basis or his argument here:
One will win more and be promoted if you are honest in long term, you can always win today by tricking somebody, but people who is being tricked could tell the world you are not a trustworthy person, you would not be used again. If you get the person for not being truthful, people tell everybody, you may win today but you will lose today. If you can cause people to think you are honest and they trust you, when more time goes on, the more you will win.
- How much do you agree or disagree with his argument and support your answer:
I totally agree with it. Reputation is everything. My father is a successful businessman, he always tell me that when do business, sometimes it is not about the quality of your product, it is about the reputation about your product. When you are seeking investment, 60% or more of the money are actually invested to the CEO/president. If your reputation is the industry is bad, you can not survive a long time.
This also holds true for personal life. If you cheat your friends once and take advantage of them, you may lose all you friends.
- Apply the SUCKER decision making strategy to a bad decision you made in your life.
When I first try to shop online, I saw a gorgeous dress on a model. Clearly, the model looks stunning in that dress, because she is 5’9 and super slim. I obviously does not look like that. In reality, I would not look good in the dress. And the dress cost about $300, which is a huge amount of money back then. While I deluded myself into believing that I would look as great as the model, although that is not the truth, but I choose not to realize that. At last, I bought it and it turns out a waste of money.
- Choose any one of the questions we analyzed in class that resonated the most with you. Tell us why? What you learned? And whether you agree with the answer?
Believing is seeing really resonated with me. People actually find evidences in life to support one’s opinion. They automatically block out the things that contradicts their thoughts. They choose not to “see” them. One of my friends was in a very unhealthy relationship. Her boy friend cheated on her and treated her very badly. She knew all of that, surprisingly she would not end it because she believed that he is the one, she would always find the trivial thing to prove that he still loves her. As friends, we can do nothing but see her suffering. You can never wake up someone who is fake sleeping.
Believing is seeing shows that one should always watch what’s on their mind, because that the believing shapes the world one lives in. Our behaviour derive from that, which also strengthen the world we believe in. So if one want to change his or her life, it is better to change the idea first.
