money

Dropping Out of College

There is a crisis and current students see it, too. Students are dropping out of college. One such student wrote about the crisis for Edsurge Independent, a platform on Medium for students to have a voice in the education technology space.

The problem, however, is how we talk about the students who drop out:

We spend a great deal of time and money trying to push students into college who aren’t ready, or for whom college isn’t quite the best choice, and then, as expected, watch them fail.

Defining these students as not ready or poor decision-makers is like blaming someone for getting food poisoning. These are students who are admitted to college. They have passed a number of hurdles to get there and then suddenly, they are not supported because they may not fit the mold of the ideal student.

But in fact, the college student mold has changed and it's important that colleges, communities, and even families revise their expectations.  

Bridging the gap between who college has served in the past and who it must serve in the future is complex, but the future of our educated populace rests on doing this hard work.

 

Child in a Lake

Peter Singer is a Yale philosopher with an interesting take on altruism - namely, how to make it effective. He proposes the following scenarios to make his point:

You are walking to a meeting where you will earn $500. On the way to the meeting you pass a child who is drowning. You can rescue the child but lose the $500. Do you rescue the child?

If you do, there's a cost to rescuing the child.

Now consider that immunizations cost $500 in India. Do you feel the same obligation?

Why do you have a different reaction to these two scenarios?

According to Mr. Singer, there is a psychological difference - salience. You can see the child and take direct action and you will get immediate feedback. The organization in India is more abstract - there is no individual, no identifiable victim. This changes then how you think of the scenario.

He points out that there is also some economic difference rooted in uncertainty - knowing something will happen versus how will I know my $500 will be effective if it's given to a immunization organization.

He asserts that uncertainty is not the main reason people have different responses to the two scenarios. True that skepticism causes a delay in decisions and a trend to prove what works is born out of this delay. But he insists that salience and identifiable victims matter for getting people to give, not evidence of what works.

Poor Me?

Let me give you a sense of how I view articles on poor college students. I was poor and with the added burden of being without family attending an elite private college - Stanford University. While I had scholarships and loans they didn't cover all the costs of attending college.  I literally had zero family support, so that meant that I had to take care of everything - a lot of things that are not covered by scholarships.  Things like transportation, clothes, medical care (campus clinics are accessible but they still cost), phone, etc.  You get the picture.

So money was very tight.  So tight that even though I was working several jobs at the same time to make ends meet, there were several occasions where I could only afford a snicker bar for food.  But did my classmates know that?  Not a chance.

I was not the first to go through this and today's students, unfortunately, will not be the last. Some of us have to work harder to get where we want to go and to stay there, but that doesn't mean others don't have to work hard in their own right. They just have to work harder for other things. Like feeling self-respect. I knew a lot of trust fund babies who felt dis-empowered because they never had to earn a thing in their life - it made them question their abilities. I've never had that problem.

I've also met folks who had everything covered for them from the get go, only to lose their money or their family to lose its money later in life and then have to learn how to budget in their 30s. It's not pretty.

I've also met people who never had to worry about money and still don't have to and likely never will.

I've gone from poor to expensive vacations to a monthly budget because I want the freedom to pursue my ideas and not have to make money to support a certain lifestyle. It's a never-ending relationship with money.

What matters is how you frame that relationship.  Are you ashamed or do you recognize your financial state as just that - a state - one that will change over time?  Guess which frame is easier to live with.

 

Money and Happiness

From a recent NYTimes article: The catch is that additional income doesn’t buy us any additional happiness on a typical day once we reach that comfortable standard. The magic number that defines this “comfortable standard” varies across individuals and countries, but in the United States, it seems to fall somewhere around $75,000. Using Gallup data collected from almost half a million Americans, researchers at Princeton found that higher household incomes were associated with better moods on a daily basis — but the beneficial effects of money tapered off entirely after the $75,000 mark.

Why, then, do so many of us bother to work so hard long after we have reached an income level sufficient to make most of us happy? One reason is that our ideas about the relationship between money and happiness are misguided. In research we conducted with a national sample of Americans, people thought that their life satisfaction would double if they made $55,000 instead of $25,000: more than twice as much money, twice as much happiness. But our data showed that people who earned $55,000 were just 9 percent more satisfied than those making $25,000. Nine percent beats zero percent, but it’s still kind of a letdown when you were expecting a 100 percent return.

 

 

Apps Are Not Necessarily Companies

Mobile apps are not necessarily companies. Finally, people who seem to understand that! Here's a post from Om Malik about a fund that is offering a new kind of financing model specifically tailored to mobile apps: Om's post After spending a year advising a number of mobile app start-ups I'm predicting that a lot of the angels who funded them won't get washed out by subsequent financing but they will lose money when the flips they counted on don't materialize. Why? Well, very few mobile apps are well-designed products that either consumers see value in and are willing to pay for, or companies value and want to bring into their fold.

Further, those mobile apps that are decent products usually are not companies - meaning they only produce a small revenue stream and usually not enough to cover lots of employees, big marketing budgets, etc.

Why I like this new financing angle is that apps behave a lot like music singles. Only a few are immediate break-out hits, but many apps, like songs, have long tails.