I don't want this blog to become a personal finance blog, but there is some math to be done with those numbers.
When I got my job last June, I had several thousand dollars in savings. At the rate I was spending it, I had enough money to last until December. That was seven months away when I got the job.
Between renting an apartment, office-appropriate clothes and a few trips to Ikea, I was in credit card debt almost immediately. Different lifestyles require different amounts of money.
That's all paid off now, but the job has still not paid for itself.
By that, I mean the following several statements:
1) I do not have the same amount of cash in hand now as when I started this job.
2) The net present value of my cash now is less than the net present value of my cash in June, 2008.
3) If money stopped comining in, the amount of time I could live off the money I have is less than it was June, 2008.
There's some simple math behind most these. The first is a simple comparision.
To fully calculate the second one, we need to know the inflation/deflation rate over the last year. According to the consumer price index, a 2009 dollar is 1.0097 in 2008. This is a pretty low difference. And since there has been inflation and not deflation, merely knowing that I have less total dollar tells me I have less real wealth.
The third one doesn't require the CPI, but just knowledge of my own finances. I'm spending around four times what I was during unemployment. So, I would need to have four times the wealth to have the same buffer.
I don't.
The job hasn't paid for itself, and at the rate I'm going, I won't hit the first marker for another year.
Maybe I really should get a big raise.
When I got my job last June, I had several thousand dollars in savings. At the rate I was spending it, I had enough money to last until December. That was seven months away when I got the job.
Between renting an apartment, office-appropriate clothes and a few trips to Ikea, I was in credit card debt almost immediately. Different lifestyles require different amounts of money.
That's all paid off now, but the job has still not paid for itself.
By that, I mean the following several statements:
1) I do not have the same amount of cash in hand now as when I started this job.
2) The net present value of my cash now is less than the net present value of my cash in June, 2008.
3) If money stopped comining in, the amount of time I could live off the money I have is less than it was June, 2008.
There's some simple math behind most these. The first is a simple comparision.
To fully calculate the second one, we need to know the inflation/deflation rate over the last year. According to the consumer price index, a 2009 dollar is 1.0097 in 2008. This is a pretty low difference. And since there has been inflation and not deflation, merely knowing that I have less total dollar tells me I have less real wealth.
The third one doesn't require the CPI, but just knowledge of my own finances. I'm spending around four times what I was during unemployment. So, I would need to have four times the wealth to have the same buffer.
I don't.
The job hasn't paid for itself, and at the rate I'm going, I won't hit the first marker for another year.
Maybe I really should get a big raise.
No comments:
Post a Comment