Full disclosure here regarding personal issues. I'm looking for advice on how to resolve them to the point where they no longer affect my life majorly. I don't expect an issue this ingrained into my psyche to ever be gotten rid of entirely. I'm sure there are other places more directly related to the subject that I could request this advice, but LWers have usually seemed to have something useful to add to things.

Recently (toward the end of 2013), I slowed, and then stopped taking Zoloft for what was purported to be emotional instability, since I was about 7 until then, when I was 21. I do not regret doing this in the slightest, as, quite frankly, while on it I was extremely flatlined emotionally and had not grown hardly at all in that regard for years. Everything was quite dull.

I have, since then, had to resort to various techniques to calm myself, as getting off of Zoloft also revealed myself to be rather anxious, and to have had latent abandonment issues resulting in clinginess to my close friends. It is the latter part that I need help with, as most literature that I've found has been rather worthless in truly actionable things, as they suggest broad things to be done and little in regards to intermediary steps, or speak to the effects, consequences, and actions that should be taken when in a romantic relationship (which I am not).

Regarding how it feels when I have an episode (for the purpose of relating to it for other people with perhaps-similar issues), I want to curl up in the corner, I get panicky, and it feels like lightning's shooting through me as a cold, heavy lump forms in my belly.

Thanks for any help you can offer.

I didn't think utility mattered at the start, but the numbers get so large so fast that it probably should. So the first issue is identifying if you are theoretically optimizing (max value in min time) or satisficing. Optimizing is simple - always invest when +EV exists/sell when -EV exists. Even if you ruin 99% of the time, you'll average the highest returns (1 - note below on actual optimization).

The only reason this is complicated is because of the second issue; the risk of ruin. This issue is actually minor in a normal random walk situation.

I've simulated a few rules and assumptions to validate the argument. Since this leverages timing, even a negative average rate of return in the underlying shows a very high rate of return for the strategy. http://imgur.com/a/ZrH6g for a quick snapshot. There are a few issues that I didn't bother to fix (namely with compound rules of holding onto stock), as the effect differs in only a minor way. For reference, actual mean should be about 1.0002, but I've only shown 0.9, 1, and 1.1.

The issue becomes more complicated if you stop assuming a normal model. The risk of ruin increases dramatically for any probability of major loss. To mitigate this risk, simply have a trading rule that prevents that risk from materializing, ie: don't buy if this risk exists, sell if it does. There are lots of ways, both technical and not, to implement this rule. I ran it as a maximum of the sum of negative impact (probability x loss) using two distinct normal distributions (emulating a binary market choice, each with their own distributions). It works, which means the proper technical approach would be even better.

In general, the rule is simple; buy when the average return is positive, hold until it the average return is negative, sell when return is negative. To protect against the risk of ruin, reject any major possibility of loss; eg: do not trade when there is a high SD (or a lumpy negative distribution).

(1) Actual optimization is pretty complicated. All of the above assumes that you get the information and make the transaction immediately. However, true optimization would involve compensating for random walks away from the information you know to be true on the assumption that it would return to the mean. For instance, with the knowledge of the actual range you could break the "buy and hold" strategy below certain thresholds, such as if the stock random walked much higher/lower than would be expected (eg: bought expecting an average of 1.05 -> random walked to 1.10; sell at 1.10 as it is probable to return to 1.05 by end of day).

This is not investment advice and should not be relied on as such.

You need to consider tax when you make investment. If you do not, you are likely to invest badly. (Note: this discussion uses UK tax rates and concepts. The tax system may well be different in your jurisdiction, but the same general principles will likely apply.)

For example, suppose I invest £100,000 in the stock market for 10 years. Let's say that nominal returns are 7% (5% capital, 2% dividends, which I reinvest), and inflation is 2%. Therefore naively, I might expect to end up with £197,000 after 10 years, i.e. £161,000 in 2014 money. That's a 5% real return per year, which looks like a good investment.

But now let's say I have to pay SDRT at 0.5% on share purchases, and 38% on dividend income. Then, when you sell the shares you have to pay 28% in Capital Gains Tax (with an £11k exemption). So now you only end up with £131,000, i.e. £107,000 in 2014 money. That's a 0.7% real return per year, which looks like a terrible investment.

If I had invested in a more tax-efficient way (e.g. through an ISA, and with a fund reinvesting the dividends for me so they never become income) then I would have been able to get the full 5% real return. But I can only put £15,000 per year into an ISA, so this isn't a panacea.

Note that the difference between the 5% real return and the 0.7% real return is an order of magnitude. If I had invested in something with just half the real return of the stock market, but done so in a tax-advantaged way, it would be a better investment than investing in the stock market in a naïve way. In particular, there is no Capital Gains Tax on your primary residence in the UK.

Executive summary:

• Investment returns are highly sensitive to tax rates.
• Tax rates are often levied on the nominal, rather than the inflation-adjusted, gains, which makes them particularly damaging for long-term investments.
• There may be legal ways to reduce or eliminate tax due on your investment.
• The way that tax is levied on your investment can be far more important to your realised return than the underlying investment itself.

And so, on a meta-level:

• Because taxation often matters more than the underlying investment, tax rates are a huge distortion of the market environment, favouring certain kinds of investments (housing) over others (providing capital for businesses).

To give a corporate example applied to real life, most people don't really evaluate risk in their own life. Here at LW and such we talk about existential risk, but I'd still guess that very few have disaster supplies or plans for much more likely events (this is from recent talks triggered by http://www.shakeout.org/ ). My wife and I talked casually over dinner about earthquakes and realised this is a non-trivial problem that probably should be taken seriously. Getting home, walking long distances, bridges, what to do if our apartment isn't structurally sound or flooded, where to meet/wait if communication is impossible, what to do in winter with no heat.

I have started working on something like that a while ago.

I have a similar vision to this but since my life ran smoothly for a couple of months, I did not put my thoughts onto paper.

Generally it seems that any organisation system is highly personal as there are many individual kinks to be worked out such that there is almost no way to have a holistic system apply to everyone. Also, the vast majority of people are not interested in these kind of things, I think.

The phrase "run your life / yourself / your family like a business" sometimes pops up but does not take the principle very far.

Also the whole thing is overwhelming. When I tried to do stuff like track my budget I ran into the problem that I would need to type in every damn receipt I got. Or be content with knowing that I spent any given sum at a grocery store, but then I wouldn't know on what products. When I buy some food on the go I needed to take note. When I get digital receipts the date on the receipt did not match the date the money disappeared from my account. And so on. The whole thing was not to be trusted and instead of helping me it bothered me, so I abandoned it for casually taking a look at my accounts and estimating how long it could last.

You might be interested in the book Getting Things Done. It was written before smartphones and cloud syncing calendars but it can easily be adapted to To-Do lists and managing your life in the modern age.

A basic summary is thus: Every action you need to do but haven't yet done is an open loop in your mind. You have to keep thinking about it until you do it, and close the loop. However, lots of things can't be done except at specific times and places. You can maintain seperate to-do lists for things that can be done anywhere (Call a friend to schedule a movie, tie your shoe, etc.), and things that need you to be at your desk, at work, or at a grocery store. Storing all the myriad things that you need to do in life in your head is stressful and difficult to successfully accomplish. If you offload this information to contextual to-do lists, you can forget about the open loop and rely on your general system to remind you if it only if you can actually do something about it. This allows you focus on things you're doing in the moment, without worrying that you're forgetting a bunch of things you still need to do.

This may be long for a stupid question... and it's not really one question... but it seems like a safe first post kind of place! It has just been on my mind a lot the last few months.

I was recently doing a review of my workplace's management system and used personal life examples to demonstrate why the management system is (/would of been) effective. Instead of convincing anyone else, I convinced myself my life would be better off if I had a personal management system.

I've googled high and low and found nothing that I could draw on. The amount of self-help and motivational books I waded through though... that was impressive. I find it particularly interesting that it doesn't seem present regardless of culture, even for procedure-heavy ones like Japan and Korea (at least in business) or more direct/rigid like Germany. Life just happens and you muddle through.

After putting pen to paper, I realised many "deficiencies" in my own life. I don't have a records "policy" - my files are on hard drives, NAS's, couple of clouds and a drive in a bank deposit box. I have no idea how many copies of my tax returns are floating around out there. I used to track expenses, but when I wanted to see my cashflow I realised I had no data for the last 2-3 years. I recently had to run out and buy some cleaning supplies because I ran out - that sums up my inventory system. That's a major barrier to cooking at home. I'm not sure what I have for emergency supplies either. I certainly don't plan (schedule or monitor) activities in my life at all. Risk management? I think my household insurance auto-renewed but not 100% sure.

Yet, I'd be considered decently organized among my peers. That seems terrifying.

Life isn't a project, or a company, but I think the "management system" approach would be beneficial because;

• It engages system 2 thinking, resulting in (presumably) better plans

• It allows optimization though sharing and iteration (assuming some common approaches develop)

• It helps communicating and being held accountable, least for a certain set of relationships

• It helps manage change, like the move from portable drives to cloud storage, or changing insurance coverage

• It increases transactional memory, where you can put trust into a system to avoid having to keep a mental maps (of files, of money, of contingencies)

• It allows outsourcing since the process is relatively well defined, such as to (virtual) assistants or maid services (I believe it'd be a net economic boom)

• It can help be pro-active, like staying in touch at regular intervals - both prompting and prioritizing (more to do with how you approach life)

However, my prior is that almost no one does this. The most I've seen are individual components - some people run very good household budgets. It just doesn't exist as an overall framework.

Why? Is it because it doesn't work and/or isn't a suitable approach? A lack of definition to "life" to structure around/optimize towards? Is it more emotional, not giving up control and flexibility? Not taught/not socially acceptable? Does System 1 not bother with it, leading to failure?

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I've spent some time working on this but it's tough and I'm really not sure the effort would be worthwhile. The trigger to take it seriously was a long chain of events that led to a life achievement list. It's still in brainstorming mode, but getting huge and it seems to me that I need to put a lot more effort into optimizing for it.

Just to be clear, a lot of the answers I have gotten in person have been along the lines of "pick what you want and focus on it". I think it misses what I'm trying to convey - how do you manage everything you don't focus on? Why do you do things a certain way? I want to know what to do with my copy of my taxes next time I file. I want to do it because I should and I want to know why I should. The system offers an imperative, built on the foundation of having thought it out and deciding "this is how it should be".