Thank you for sharing this and your unfortunate diagnosis. I hope you find or have some serenity in in your life. I am 67, retired 3 years ago after over 40 years of software development. I'm not rich, but I think I will be OK. I am living proof of the value of index funds and compound interest. My Mom was paying $6300 a month for assisted living before she passed last year, she was doing pretty good until COVID destroyed her social network and then she needed more and more help.
"Time value of money" means something else to the Finance folks, where you end up talking about Net Present Value, and the main factor in the conversation is the return on investment over that time.
This is why "Cost of Delay" exists as a (quite separate) concept.
Thank you for sharing tour thougth on that because i felt really passionnate about finance and options precisely because the famous time is money is made physically true with options. Also Taleb’s books help understand that concept. But something I cannot understand yet is why is always people that not creates value that capture the most of it contrary to those who create it ? And yes As geeks we should be interested in how money management affects our life.
Working in (EU) pensions this shows part of the problem we are trying to solve: how to generate a decent pension in the far future, with least risk possible, at a certain amount paid today.
Because money available for spending today has more value, specially around life events. And the use of future money (pension payments) is uncertain, both for being alive and the amount available (we really try to be predictable on that...).
So we move today's money towards the future, to have a probability of future cash flows, as we call it in finance.
Your situation sucks, in being that the best years for you are the years closest to now. Meaning value for money now is higher than value tomorrow, but you can't bring tomorrow's money to today. At least not with some kind of financial construction.
Your work, your payout, is close to what we call a J-curve, being that you first invest (negative cash flows) before generating income. But that upward part of the J-curve is too late for you.
You are essentially seeking a way to move probable future cash flows (let's say 5-10 years from now, the upward part of the J-curve) towards the near future, let's say 1-3 years from now.
Turning the question, from a financial perspective, into what the fair value today is for the probability of these future cash flows. Where you give these up, and others obtain these.
And then, if we have that fair value, who's willing to take the other side of the contract.
In financial terms, you might seek a way to trade an equity position for a couple of zero-coupon fixed income bonds, with maturity let's say 1-3 years. With that you'd fix your income for those three years, not receiving all at once, while the others have the benefits of the equity position over the longer term, if there are indeed benefits. That's their bet, since the future cash flows for them are probabilities and your side, provided you live, is certain.
Maybe this helps your reframe the situation in a way which allows you to gain the near term cash flows you seek.
Loans opens a whole new conversation. Businesses running on finance are facing higher interest rates now as they refinance when their loans become due in full. Having paid only the interest rate, because deferring payment is a strategy too, now that interest rate is higher after a refi and thus the payment is higher.
Triggering default causes a chain reaction of other events and really bad things happen so businesses must slash costs. Highest cost form any businesses is... you guessed it employees!
High interest rates do destroy the economy but volatile interest rates do as well. Low interest rates are like nitrous in an engine...speed now for wear and tear that will cause the engine to break down later.
Thank you for sharing this and your unfortunate diagnosis. I hope you find or have some serenity in in your life. I am 67, retired 3 years ago after over 40 years of software development. I'm not rich, but I think I will be OK. I am living proof of the value of index funds and compound interest. My Mom was paying $6300 a month for assisted living before she passed last year, she was doing pretty good until COVID destroyed her social network and then she needed more and more help.
I’m not even at the extreme time value stage yet but these themes are on my mind a lot now that I’m in my 40s with two kids who are growing too fast.
"Time value of money" means something else to the Finance folks, where you end up talking about Net Present Value, and the main factor in the conversation is the return on investment over that time.
This is why "Cost of Delay" exists as a (quite separate) concept.
I'm not understanding the distinction you're making. What does "time value of money" mean to finance folks? Can you give me an example?
I also talk about cost of delay as a separate concept, even though NPV and cost of delay can be placed on the same graph since the axes are the same.
Would selling / licensing your intellectual property to an AI company work?
... or sue them for infringement
Thank you for sharing tour thougth on that because i felt really passionnate about finance and options precisely because the famous time is money is made physically true with options. Also Taleb’s books help understand that concept. But something I cannot understand yet is why is always people that not creates value that capture the most of it contrary to those who create it ? And yes As geeks we should be interested in how money management affects our life.
Interesting read, thanks.
Working in (EU) pensions this shows part of the problem we are trying to solve: how to generate a decent pension in the far future, with least risk possible, at a certain amount paid today.
Because money available for spending today has more value, specially around life events. And the use of future money (pension payments) is uncertain, both for being alive and the amount available (we really try to be predictable on that...).
So we move today's money towards the future, to have a probability of future cash flows, as we call it in finance.
Your situation sucks, in being that the best years for you are the years closest to now. Meaning value for money now is higher than value tomorrow, but you can't bring tomorrow's money to today. At least not with some kind of financial construction.
Your work, your payout, is close to what we call a J-curve, being that you first invest (negative cash flows) before generating income. But that upward part of the J-curve is too late for you.
You are essentially seeking a way to move probable future cash flows (let's say 5-10 years from now, the upward part of the J-curve) towards the near future, let's say 1-3 years from now.
Turning the question, from a financial perspective, into what the fair value today is for the probability of these future cash flows. Where you give these up, and others obtain these.
And then, if we have that fair value, who's willing to take the other side of the contract.
In financial terms, you might seek a way to trade an equity position for a couple of zero-coupon fixed income bonds, with maturity let's say 1-3 years. With that you'd fix your income for those three years, not receiving all at once, while the others have the benefits of the equity position over the longer term, if there are indeed benefits. That's their bet, since the future cash flows for them are probabilities and your side, provided you live, is certain.
Maybe this helps your reframe the situation in a way which allows you to gain the near term cash flows you seek.
What's the software equivalent of breaking bad?
>Is there a way to sell long-term benefits for short-term revenue?
Tbh this is called taking out a loan. Get money now and pay it off later.
Loans opens a whole new conversation. Businesses running on finance are facing higher interest rates now as they refinance when their loans become due in full. Having paid only the interest rate, because deferring payment is a strategy too, now that interest rate is higher after a refi and thus the payment is higher.
Triggering default causes a chain reaction of other events and really bad things happen so businesses must slash costs. Highest cost form any businesses is... you guessed it employees!
High interest rates do destroy the economy but volatile interest rates do as well. Low interest rates are like nitrous in an engine...speed now for wear and tear that will cause the engine to break down later.