The Trader Who Donates Half His Pay • Hacker News Board

Re: The Trader Who Donates Half His Pay

#91

Post by hkmurakami » Mon, Apr 06, 2015, 5:06 PM UTC

willmacaskill wrote: post #40

jtbigwoo wrote: post #37

I talked about this on HN a few years ago, but my friends and I planned to be this guy. In college we talked about all the money we'd make and how much we'd be able to donate. We all had a job offers for $32 - 42k/year. That was amazing! We were living on less than $1k/month in college. We had plans to give away 20%, 30%, or 50% of our income. We would barely even notice. Some of us even managed to do it for a few ye…

I think this is a really important concern. Btw, 5% is still quite a bit more than the average, so good work! We're attempting to overcome this worry through community and behavioural economics hacks. E.g. I take every opportunity that I can (like this one) to say publicly that I'm planning to give away the majority of what I earn, which makes it a helluva lot harder for me to back out. Similarly for Matt - it would…

Not only is 5% of one's income a rather high number, even the average amount that people give in the United States is far higher than the corresponding amount in other countries (ex: Japan).

It may be the country's Christian leanings that contribute to this, but to be charitable is seen as a virtue and absolute good in this society. This is not necessarily the case in other societies.

Re: The Trader Who Donates Half His Pay

#92

Post by rm999 » Mon, Apr 06, 2015, 5:07 PM UTC

jimbokun wrote: post #54

jtbigwoo wrote: post #37

I talked about this on HN a few years ago, but my friends and I planned to be this guy. In college we talked about all the money we'd make and how much we'd be able to donate. We all had a job offers for $32 - 42k/year. That was amazing! We were living on less than $1k/month in college. We had plans to give away 20%, 30%, or 50% of our income. We would barely even notice. Some of us even managed to do it for a few ye…

The muscles you use for giving are the same muscles you use to save or pay down debt. Know what your expenses are and how much you are spending. Know which of the things you spend money for are really important to you, and what you wouldn't actually miss that much. Know how to keep your spending in check as your income grows, not just increasing spending because the money is there. People tend to react emotionally to…

As someone who constantly struggles with the decision to save VS donate, I don't think the two are interchangeable. They seem interchangeable because most of the time they'll lead to the same endpoint, but I view savings as an insurance that protects me against catastrophic events. They enable me to live a riskier life by providing that cushion and security.

I've decided to donate after I've lived the life I envision. If I get sick or injured and can no longer live that life, my savings will be my charity to myself. The subtle difference is that savings can be turned into charity, but not the other way around.

Re: The Trader Who Donates Half His Pay

#93

Post by krstck » Mon, Apr 06, 2015, 5:07 PM UTC

tomjen3 wrote: post #82

krstck wrote: post #56

From the article: > First, where do we draw the line? If we’re prepared to donate one-third of our incomes to maximize happiness, then why not two-thirds? Why not live in a tent in a park so as to be able to donate 99 percent and prevent even more cases of blindness? This is an area where the writings of Scott Alexander (Slate Star Codex) have been really helpful for me. He refers to this as "Infinite Debt" ( http://…

The problem with that is that it only works if you believe that 10% makes sense. For me it doesn't - it is either 0% or whatever several 100% of my current income it would take to do my part (I don't see how not currently earning enough to repay would be enough to get me of the hook, certainly car payments are not payed in percentage of income). Thus, for me, the only answer that makes sense is that we have no obliga…

> Thus, for me, the only answer that makes sense is that we have no obligation to save the world, but we are allowed to donate whatever we want.

That's the status quo. The whole reason we're having this conversation is because not enough people are donating X% in order to fix global poverty. So, what's your burden? What's my burden? 10% is a handy figure because it's small enough to be doable for most people, but large enough such that if everyone were donating 10%, we'd have enough money to basically fix global poverty forever.

It's handy for us to agree to discharge our infinite debts to each other by agreeing upon some figure. 10% fits that nicely.

Re: The Trader Who Donates Half His Pay

#94

Post by dublinben » Mon, Apr 06, 2015, 5:09 PM UTC

nashashmi wrote: post #38

willmacaskill wrote: post #25

Earlier quoted context omitted.

What I find most amazing is when bright Ivy League graduates go and do manual labour, like building a school, in a poor country with massive unemployment. It's not exactly playing to comparative advantage.

That's pretty much how they become brighter. These kinds of hands-on experience are far more transformative and contribute to higher efficiency than if they were to simply donate more money.

At least they could acknowledge that they're going abroad to help themselves, rather than the beneficiaries of their "charity."

Re: The Trader Who Donates Half His Pay

#95

Post by buro9 » Mon, Apr 06, 2015, 5:10 PM UTC

https://en.wikipedia.org/wiki/Tithe

10% of income is doable.

I treat it like a form of tax in which I have a say. It's going to be taken (that's the way in which I think of it as a tax), but now I get to say who receives it.

Last year I favoured Medicine San Frontiers due to the Ebola outbreak, but in general I favour Liberty, Open Rights Group and small charities that provide computers to Africa, or bicycles for the disabled in the UK (Wheels for Wellbeing).

10% really isn't too much, and so long as you do it early you'll likely never notice it.

Then again... perhaps this is why I don't have a deposit for a mortgage. Or perhaps that was poor budgeting for the bit of salary I did take home and keep.

Re: The Trader Who Donates Half His Pay

#96

Post by a3voices » Mon, Apr 06, 2015, 5:12 PM UTC

Should you also donate money to save hypothetical aliens in a far away galaxy, if we find out they exist? What about a fund to help people relocate from flooded cities from global warming 200 years in the future? What about donating to keep A.I. simulations from being shut off? Why donate to help people and not animals or bacteria? What about the fact that the universe is going to die from entropy, and all people die anyways from old age? What's the point?

Note: I try to not donate any of my money to any cause ever

Re: The Trader Who Donates Half His Pay

#97

Post by akgerber » Mon, Apr 06, 2015, 5:12 PM UTC

whatok wrote: post #11

fweespeech wrote: post #5

Earlier quoted context omitted.

Keep in mind, he does live in NY and works on Wall St so he likely needs $100k to live a decent middle class life tbh. ---- Since it doesn't want me to reply again [I'm submitting too fast] If you can support a family of 4 in NY with less than $100k while qualifying as middle class, I'm curious how you manage it. :) http://council.nyc.gov/html/action/acpdfs/middle_Class_squee... Fyi: Real median household income for…

That and he's in a field that has volatile pay and employment so extra nest egg is essential. Not sure how he builds up savings (probably lives very frugal) but props to him for donating half his pay.

Living on $75k or so after-tax in NYC as a young single man isn't 'very frugal'. A nice room in a roommate situation can be had for $1000/mo, a very nice one for $2000, which totals $12k-$24k per year. Likewise a modest reasonably-located 1bedroom/studio can be had for $2000/mo. After that, the only mandatory expenses are $1000 or so a year for transportation and reasonable expenses for food, though much of that cost is likely paid by his employer.

Re: The Trader Who Donates Half His Pay

#98

Post by MaulingMonkey » Mon, Apr 06, 2015, 5:13 PM UTC

josefresco wrote: post #15

fweespeech wrote: post #5

Earlier quoted context omitted.

Keep in mind, he does live in NY and works on Wall St so he likely needs $100k to live a decent middle class life tbh. ---- Since it doesn't want me to reply again [I'm submitting too fast] If you can support a family of 4 in NY with less than $100k while qualifying as middle class, I'm curious how you manage it. :) http://council.nyc.gov/html/action/acpdfs/middle_Class_squee... Fyi: Real median household income for…

I was composing a critical comment, and then realized it doesn't matter that this guy makes. Even if he made only $50K there would be some criticizing how "well off" he is. The moral here is to make a difference - and don't hesitate to give money (if that is what you have) based on the fear that it will me mismanaged or not help.

I would disagree with the latter half of the moral as stated. I think those are entirely reasonable concerns to hesitate in giving money to e.g. a specific charity.

That said, what I think you intend to get at - don't let the perfect be the enemy of the good - do some basic due diligence, but don't let "due diligence" freeze you into inaction - I agree with that.

(edit: I started a sentence without finishing it -_-;;)

Re: The Trader Who Donates Half His Pay

#99

Post by betenoire » Mon, Apr 06, 2015, 5:14 PM UTC

jimbokun wrote: post #69

betenoire wrote: post #61

Earlier quoted context omitted.

You are saying it's just as easy to save/donate as it is to spend because the muscles and underlying principles are the same? I wish I'd heard about this sooner.

I was comparing saving to donating, and contrasting with spending. So the exact opposite. Was I really that unclear?

To me you were. They are nothing alike to me. Different states of mind, different objectives, different strategies.

Donating and saving are two entirely different activities in my life, and the only similarity are the numbers on the ledger. (one has an immediate payoff (donating feels good) while the other is not satisfying at all (just helps me sleep)).

You're advice sounded a lot like the financial version of, "stop eating less and you won't be fat." ... but I guess that does work for some people ...

Re: The Trader Who Donates Half His Pay

#100

Post by morninj » Mon, Apr 06, 2015, 5:14 PM UTC

bch wrote: post #78

morninj wrote: post #74

Earlier quoted context omitted.

> The muscles you use for giving are the same muscles you use to save or pay down debt. Citation needed.

I think all he's saying is that if you get in the habit of living on less $ (because you're giving 20, 30, 40, 50% away to others), if you decide to give it to _yourself_ to paydown debt, or save for retirement, you're already used to living on "50% income", so it may not be as difficult as for soemone who hasn't done this exercise. Edit: sloppy typing

The motivations are different: paying down my debt enhances my own financial well-being, while donating to charities enhances others'. Or: paying down debt is self-interested, while donating is selfless (or at least self-interested in a different way).