The Writers Coin

The health care debate has set off a huge debate about how this country should deal with the health care of its citizens. But don’t worry, I’m not about to get into the thick of that debate on a personal-finance blog. But I did read something interesting in James Surowiecki’s latest New Yorker article on the health care debate. He starts out the article talking about how people feel about change:

There are times when Americans’ attitude toward health-care reform seems a bit like St. Augustine’s take on chastity: Give it to us, Lord, but not yet. In theory, the public overwhelmingly supports reform—earlier this year, polls showed big majorities in favor of fundamental change. But, when it comes to actually making fundamental change, people go all wobbly. Just about half of all Americans now disapprove of the way the Obama Administration is handling health care.

What happened that caused people to change their minds so drastically and so quickly? Was it all those town-hall meetings that turned ugly? Maybe, but the flip flop in position is the perfect example of how hard it is to get people to change.

Surowiecki goes on:

…the public’s skittishness about overhauling the system also reflects something else: the deep-seated psychological biases that make people resistant to change.

He goes on to quote experiments from Dan Ariely (author of Predicably Irrational, a book I’ve discussed before) on how people value something that they have more than something they don’t have, regardless of whether or not it makes sense.

This can explain our reluctance to change lots of things in our lives: our jobs, our careers, our routines, etc. It even has a name: “the endowment effect.” The thinking is that, while the “current system” might not work very well, at least it works. And trying to change it might be a lot of work—not just to effect the change, but to adjust to the change.

Can you think of something in your life you’d hesitate (or have hesitated) to change because you’d rather keep the status-quo?

Image by Joe Shlabotnik

Want to know how I downloaded my very first MP3? It was The Devil Goes Down to Georgia, I downloaded it through mIRC, and I played it on my RIO PMP 300 player. Which let you listen to around seven songs at one time before you had to hook it up to your PC and switch the music out.

I know, I’m totally old school.

Downloading an MP3 back then was a real hassle.

Then Napster came along and changed everything. But it wasn’t legal, and a lot of people were still very skeptical. If you were in college, you got it, but everyone else didn’t trust MP3s. They had a “pirate” label attached to them.

Well, now MP3s are a part of our culture and the music industry itself has changed dramatically because of it.

But it had little to do with the MP3. It’s all Apple’s fault.

Apple Killed the Radio Star

I remember when I told people about my MP3 player and how I got music on it: they weren’t impressed. And for the longest time, I didn’t think MP3s would ever hit the mainstream.

Then iTunes came along and changed the whole game.

iTunes made it so anyone, and I mean anyone, could easily download music, pay for it, and listen to it on their computer/iPod in a way that was legal and cool.

All it cost you was a buck.

That was no small feat.

What Can We Learn From Apple?

I was thinking about all of this after reading this post on Apple and it hit me that what they did wasn’t terribly creative. They took an existing idea and made it better.

The thing is, they made it much better.

I spend a lot of time trying to come up with brand new ideas that no one else has come up with before. It’s really hard to do and it takes its toll. But what Apple proved with iTunes is that creating a better way to do something that’s already out there can be just as valuable. It’s not always about new and fresh, it’s about more efficient and better.

Look around your job/life and see if you can’t take an existing process or task and make it better. Or look at your budget and see if you can make it more efficient somehow.

Better doesn’t always have to be new or creative, but it can make a world of difference.

None of us are as smart as we think, especially when it comes to learning something new. I’m all about saving money by doing things like getting an “MBA” without going to business school, but teaching yourself a new skill all by yourself will only take you so far.

Taking a class or reading a book is great, but it has its limits. I’m calling that limit the threshold of specificity. After a certain point, you need to create your own personalized learning curriculum if you want to take your skills to the next level.

In other words, you have to do a little more work than just reading a book or taking a generic class.

Some examples:

• Learning a New Language: Taking a class or using software to learn some basics will give you a start. But if you really want to learn a language through and through, you’re going to have to take a one-on-one class that’s customized to your ability and to your needs.
• Learning to Play an Instrument: Same as learning a language—generic lessons will get you started but to truly become a master you need to take matters into your own hands. You have to practice for hours and years on end to really “get it.”
• Everything Else: How many books do you see in the “self help” section of the bookstore/library? Tons. People want to become better—that’s why you’ll see commercials promising the world at 12:30am on a Saturday night (I personally haven’t…um…seen them).

Busting Through the Threshold

I’m a huge proponent of online learning. Reading books, blogs, and magazines about any subject can definitely make you better at it. It’s how I taught myself the little I do know about advertising, investing, and personal finance.

But there is a limit to all this generically directed teaching. It can’t go past a certain point because all people learn in different ways and generic information can only take you so far. To go beyond that, you have to get more specific.

Enter the “Threshold of Specificity.” When you hit this limit, you have to get proactive to go beyond this level of learning.

You have to be able to say “I am different from everyone else in the following ways and here is how I am going to expand my learning.”

You have to tailor your learning specifically to yourself to take the next step.

You have to start putting more of yourself into the whole process and stop relying on external forces like books or self-help gurus to teach you the way.

You have to start being personally specific about what you’re trying to learn to ensure it applies to you and what you want.

For Example

I tried to teach myself everything I could about advertising by reading books, creating spec work, and interacting with people in that community. But eventually I hit a wall. I needed to actually become a part of the industry and start working in it to go further. And I did.

I couldn’t have learned what I learned without taking that step.

I’ll go into more detailed examples of how to bust through the threshold in another post. But until then, have you ever encountered the threshold of specificity in your life?

Image by mangpages

Nobody wants to be called “boring,” but what if being boring could save you tons of money? As in thousands of dollars at a time?

Not so boring now, is it?

That’s what The Boring Challenge is all about. It started with my boring lunch post and then yesterday I launched The Boring Challege over on Wisebread.

What is it?

The Boring Challenge is all about getting people to save money in new and different ways that don’t sound very exciting. They may be boring, but that also means they’re easy to try out, at least for a week.

So if you practice frugality in a boring way, leave a comment on the Wisebread post and I’ll compile all of these later on.

If you’re someone looking for new ways to save, check out the comments and tune in later for a compilation post with all the different ways to save that people have sent in.

And don’t forget to include how much money being boring can save you!

Photo by Samael Trip