On Wild Problems

 

As I run a programme that is highly dependent on number crunching by computers, I'm fully aware that there are a class of problems that simply cannot be analysed by data and statistical models. 

In Russ Robert's Wild Problems the vivid example is the question of whether we should get married or have children. Especially when it comes to having children, if everyone were to boil the decision-making down to cost-benefit analysis, no one will have kids in Singapore. And yet, even a child-hating misanthrope like me would love my kids so much, that I'd gladly disadvantage myself financially so that they can have a good life. 

This means that there are definitely mental models beyond quantitive ones that are required to resolve that class of hard problems that lives throw at you.

One solution to the children's problem is to understand that looking at the kind of cost-benefit analysis is based on the fallacy of narrow utilitarianism. If you find some money in a wallet and there was no one there to witness you finding the wallet, you may really hate to surrender the wallet to the police because it's full of cash that can be used to pay for your children's expenses. But you return it anyway because keeping the money changes the notion of your identity. You can't live with yourself if you keep the money. Folks who return the wallet ultimately prefer to make decisions on personal principles and not that of narrow utilitarianism. 

I think something has to be said about choosing to remain single. There are almost zero disadvantages to not having children, you will end up having more money and time. If you feel bad, you can even volunteer your time to charity. But to remain childless is essentially not propagating your genes, and you won't be able to find out what your kids will ever be like while growing up. I don't think this ultimately bothers some of my single friends, but I think it does bother me a little. 

For me, I'm dealing with a tough question in my own life.

As my training business is struggling with sales and I've just obtained my CFA charter, I've started talking with pals in law firms to see whether I can get part-time hourly paid consultant gigs with them since an entry-level lawyer is kinda expensive and I should really address the issue of going through law school without even trying out legal work beyond my training contract. 

So yesterday, I had the privilege to meet very possibly the richest and most successful customer I will ever get as a trainer, and he totally shot the idea down. He does not think that starting out as a rookie lawyer will do me any good as a middle-aged guy and there are better ways to scale a business. And he was very kind enough to suggest a few ideas which I liked a lot and may pursue with some folks.

As he's been around, I have to accept that this is valid feedback. Me going back to the law firm has always sounded ridiculous, but so was entering law school at age 39, and saving 100% of my take-home pay since I was 32 years old. 

But once again, this is a cost-benefit analysis. If we take it too far, as a financially independent guy with a five-digit dividend monthly income, nothing I do can compensate me for the time I waste on the job, so I cannot just apply one quantitative mental model to this problem of what I want to do with my life next. Also, I'm not quitting my job as a trainer, my condition is that the law firm needs to let me carry on teaching my Early Retirement Masterclass.

So what kind of personal principle can justify starting as a part-time associate in a law firm while balancing my time with a training business?

After a day of deep thinking, I think my central principle is "When you set out to do something, you must complete the task. "

• My stint as a trainer finally got me my CFA - nineteen years after I passed the Level 3 exams. It required 3 years of full-time work as a training professional. 
• In law school, I always found some of my classmates ridiculous, I had classmates who dropped out in the final year after paying all the school fees. 
• I used to get exasperated at friends who can only talk about publishing a book but never complete a proper manuscript, it was the main reason why I set out to write three books on personal finance as an IT engineer. 
• Even if the last 2 seasons of Game of Thrones sucked balls, I watched it anyway.

Now, I admit that I did not enjoy my practice training, I was mildly depressed when I asked Dr Wealth for help. Thanks to my partners, I created a business line called ERM that exceeded a million dollars in revenue. But this time, I get to choose my level of engagement in a firm and who my colleagues are going to be - I'm starting without a base income. If I fail, I have multiple fallback positions and no one in my family will starve as a consequence of my decisions. 

The fundamental principle is that I should try three years of actual legal practice because I am a completist and not doing would have serious consequences on my self-esteem.