High-tech Japan running out of engineers

This morning walking to work, I remembered reading an interesting New York Times article entitled "High-tech Japan running out of engineers." Japan running out of engineers? That seems impossible! Here are some reasons given in the article:

But according to educators, executives and young Japanese themselves, the young here are behaving more like Americans: choosing better-paying fields like finance and medicine, or more purely creative careers, like the arts, rather than following their salaryman fathers into the unglamorous world of manufacturing.

Later in the article:

Japan’s biggest problem may be the attitudes of affluence. Some young Japanese, products of a rich society, unfamiliar with the postwar hardships many of their parents and grandparents knew, do not see the value in slaving over plans and numbers when they could make money, have more contact with other people or have more fun.

And a little later in the article:

“Students today are more demanding and individualistic, like Westerners,” said Hitoshi Kawaguchi, senior vice president in charge of human resources at Nissan.

I would like to write a rejoinder that engineering is not worse than finance, medicine, and art as a career, but it's hard for me to say, since I know nothing about Japanese culture.

I must be really old-fashioned. I don't consider myself "demanding and individualistic." Still, if engineering is becoming as respected as plumbing, that doesn't bode well for scientific literacy in first world countries. It disturbs me how Asian culture is shifting towards Western values. I hope traditional Asian values like family, discipline, and respect for elders don't disappear.

Receipt system

I download my transactions via Quicken's One Step Update, but I verify the transactions by comparing them to the receipts I've collected. I get receipts not just for buying items, but also for withdrawing money from ATMs, depositing checks, etc. I also try to remember when I spend cash so I can enter transactions in my Quicken cash account. For transactions without receipts, I write them down on an index card. This includes returning items. Occasionally, I jot a note on receipt to clarify the category. For instance, I might spend money on postage to return clothes. The transaction will show up in Quicken as USPS, but I want to categorize it as "clothes" not "postage".

The receipts I collect go into a small manila envelope.


Every week, when I download transactions into Quicken, I check the payee name and transaction amount against the receipts in my manila envelope. If the two are reconciled, then I put the reconciled receipts into an expanding file with pockets for different months.


Every now and then, I clean out the expanding file and throw out old receipts. I'm not running a business so there's no need to keep receipts. I suppose if I were really obsessive, I could scan the receipts with a flatbed scanner.

Learning Quicken 2008

I finally finished reading the book Quicken 2008: The Missing Manual. I've been using Quicken for the past few years, but not very well. I decided to get a book to understand what I'm doing. Here are some important things I learned.

• If you withdraw money from an ATM or pay your credit card, these transactions need to be marked transfers. Otherwise Quicken will think that your credit card payment is an expense. In these transactions, the money is staying inside your accounts, not going to an external institution, so these transactions should be transfers.
  
• Set up a cash account for incidental cash expenses. Whenever you withdraw money from an ATM, enter a transfer transaction between your checking account and cash account.
  
• I can download all my transactions with One Step Update! This marvelous Quicken feature allows you to click a button and have the program automatically download all recent transactions to your accounts. For me, this includes my bank, online savings accounts, credit cards, and investments at Vanguard. I used to manually download transactions from institution websites.
  
• The book recommends *not* clicking on the "Accept All" transactions button. You should check that the transaction is valid by matching it against written records/receipts. I now keep receipts (for purchases, ATM withdrawals, checking account deposits, etc) in an envelope on my desk.
  
• If you buy something that you will be reimbursed for later, mark the transaction as being in the category "Reimbursement." You can later mark the reimbursing check as being in the category "Reimbursement" as well. You can also setup a Quicken alert reminding you to check if you've been reimbursed.
  
• You can save attachments and associate them with transactions or accounts in Quicken. For instance, you can save your credit card statements as .pdfs and associate them with the appropriate credit card account.
  
• New to Quicken 2008: You can tag transactions. This is great because a transaction can have more than one tag, whereas it can only have one category.
  
• You can use Quicken's budget function to make budgets. I'm still playing with this function. My expenses vary wildly from month to month because I have a $5000+ expense that comes twice a year.

Not to make things sound perfectly peachy, I did run into a few problems. I couldn't get two of my credit card accounts to update using One Step Update. I had to delete the accounts, go to the credit card websites and download transactions manually. Then in the process of downloading, Quicken asked me to create the appropriate credit card account. When I created the credit card account in this manner (rather than using the File -> New command), the update worked properly.

Also, some of my investment accounts were inaccurate because Vanguard only allows you to download the last 18 months of transactions. For my accounts that were older than 18 months, there was a placeholder transaction which simply says "you had x shares of mutual fund y on z date." There's no pricing information so Quicken can't properly calculate how much money you invested. I had to enter about 60 transactions manually to make my investment accounts accurate and up-to-date.

I found Quicken 2008: The Missing Manual a very instructive book and recommend it highly.

Multiple savings accounts in ING Direct

From Ramit Sethi's blog, I found out that you can set up multiple accounts in ING Direct. That means that if you have an Orange Savings Account, you can set up multiple Orange Savings accounts and access them with one password! This is really useful since you typically need to save money for several different purposes. Having separate accounts makes tracking easier and prevents you from accidentally taking money out of an important savings account (e.g. emergency savings). I went ahead and set up three accounts, each with a different nickname: "general savings", "emergency fund", and "rent". I have an account for rent because I only pay my rent in huge chunks, three times a year.

I also have a HSBC Direct account, but I'm thinking of dropping it in favor of ING Direct because HSBC doesn't allow One-Step Update in Quicken. I've also heard that the Electric Orange ING checking account is good. I've been using a Wachovia student checking account which for a while had no fees. Unfortunately, now Wachovia charges for downloading from Quicken -- a ridiculous $6/month fee.

Suze Orman on personal finances

In the last few weeks, I've been trying to learn more about personal finances. I read this great book by Suze Orman called Women and Money. Why a book about women in particular? Orman says that she herself was surprised to find herself writing such a book. However, after many experiences talking to female friends, she realized that many women lack confidence and let their lack of confidence screw up their personal finances.

I don't lack confidence. My mom is a business owner and has been investing money for me and the rest of the family since I was born. But I have a tendency for excessive spending and occasionally giving gifts when I can't really afford it. Reading Orman's book has inspired me to spend more time on personal finances. My mom already did a great job by investing the maximum every year in my Roth IRA and setting up a Vanguard retirement and brokerage account for me (with no service fees!). I've got a great start.

For young people like myself, Ramit Sethi recommends three books to learn about investing.

• Suze Orman, The Money Book for the Young, Fabulous, and Broke
  
• Taylor Larimore, Mel Lindauer, Michael LeBoeuf, The Bogleheads' Guide to Investing
  
• David Swensen, Unconventional Success: A Fundamental Approach to Personal Investment