-From The Behavior Gap
Why do we lose money?
- [-] Other Available FormatsOur PriceNew & Used MarketplaceThe Behavior Gap (Audio Compact Disc - Unabridged)
Publisher: Gildan Media Corporation$29.98
-From The Behavior Gap
Why do we lose money? It's easy to blame the economy or the financial markets-but the real trouble lies in the decisions we make.
As a financial planner, Carl Richards grew frustrated watching people he cared about make the same mistakes over and over. They were letting emotion get in the way of smart financial decisions. He named this phenomenon-the distance between what we should do and what we actually do-"the behavior gap." Using simple drawings to explain the gap, he found that once people understood it, they started doing much better.
Richards's way with words and images has attracted a loyal following to his blog posts for The New York Times, appearances on National Public Radio, and his columns and lectures. His book will teach you how to rethink all kinds of situations where your perfectly natural instincts (for safety or success) can cost you money and peace of mind.
He'll help you to:- Avoid the tendency to buy high and sell low;
- Avoid the pitfalls of generic financial advice;
- Invest all of your assets-time and energy as well as savings-more wisely;
- Quit spending money and time on things that don't matter;
- Identify your real financial goals;
- Start meaningful conversations about money;
- Simplify your financial life;
- Stop losing money
It's never too late to make a fresh financial start. As Richards writes: "We've all made mistakes, but now it's time to give yourself permission to review those mistakes, identify your personal behavior gaps, and make a plan to avoid them in the future. The goal isn't to make the 'perfect' decision about money every time, but to do the best we can and move forward. Most of the time, that's enough."
Publishers Weekly® Reviews
- Reviewed in: Publishers Weekly, page .
- Review Date: 2011-11-28
- Reviewer: Staff
In this accessible book, financial planner and Morningstar Advisor columnist Richards sits down to talk about money and the crazy choices we make. Through personal stories and simple ideas enlivened with a touch of imagery (often literally sketched on the back of a napkin), Richards explains why we keep making bad choices and shows us that we’re often making decisions with our emotions rather than our intellect. However, Richards isn’t saying that investors try to eradicate their emotions; rather, they should aim for an investment strategy that balances managing fear and greed in a way that “truly reflects your own emotional strengths and weaknesses.” Once readers recognize what influences their decisions, they’ll be much better able to act rationally. Richards then covers a vast array of topics, from investor emotions to information overload. He offers suggestions for combatting decisions that might be overly influenced by emotions, such as in periods of market turmoil, by taking “the overnight test,” trying a media fast, or simply finding your focus. Whether relating a Zen story or talking about the Economist smirk, Richards succeeds in showing us how what we often think is right regarding investments rarely is. (Jan.)