Investor pyschology

This Is Boston Not L.A.: A Primer on Financial Poseurs

Definition of Poseur: “A person who pretends to be what he or she is not: an affected or insincere person.” When I went to college in Boston during the 1980s, there was a great debate taking place. I am not talking about whether the Socratic Method was still a relevant teaching strategy. The issue was much…

Everyone Has a Plan Until They Get Punched in the Mouth

Aphorisms are short bursts of knowledge that you really have to think about. In our immediate gratification society, this is no easy task. Some of the greatest investors in the world spend an inordinate amount of time thinking. You can include Warren Buffet and Charlie Munger at the top of this list. Revisiting these timeless bits of…

Don’t Let Instinct Ruin Your Financial Plan

The human instinct to focus only on immediate threats to our well-being is hard-wired. It evolved because it kept early humans physically safe. But while the instinct to run from danger was invaluable to a Neanderthal roaming the savanna as a hunter/gatherer, it can be devastating to a long-term financial plan. Just think about the…

5 Ways to Turn Inertia Into Financial Momentum

Too many choices and inexperience with complex issues are two of the biggest impediments to creating wealth. Limiting choices and automation, on the other hand, are great ways to improve your decision-making. In their excellent book “Nudge,” authors Cass Sunstein and Richard Thaler identify a couple of reasons why most people are not very good at managing money. Through…

Building Wealth: Stick to It and Ignore the Joneses

By Anthony Isola Learn more about Anthony on NerdWallet’s Ask an Advisor Building wealth is a process, not an event — a process that takes discipline and a long-term outlook. You must focus on yourself, not what others are doing. Work hard and maintain a consistent approach. This may not be easy, but it’s doable…

Don’t Be A Screen Junkie

Spending too much time in front of entertainment screens has negative effects on both your health and finances: it can turn your children into emotional basket cases and ruin your retirement plans. A recent article in the NY Times entitled “Screen Addiction is Taking A Toll on Children”  fires a warning shot  and sounds an alarm about…

How you can Avoid the Tricks of Financial Salespeople

Often people will buy financial products not on their merits but on the basis of the salespersons personality. Physical Attractiveness, flattery, and perceived common interests often close the deal. You are often left with a false friend and an unsuitable investment. Rejecting this tempting bait can be very difficult. Robert Cialdini ,in his book The…

It’s the End of the World As We Know it, and I Feel Fine

This line from a classic R.E.M. song from the 1990s sums up my feelings on this whole Greek Fiasco.  While there is a strong possibility for “short-term volatility” a.k.a. a sudden scary market plunge, on the whole the news from this beleaguered isle means little to my clients’ long-term financial plans. Creating a portfolio without…

Sudden Wealth Often Disappears

Many people who find themselves with an unexpected large sum of money often lose it all. While money can solve many problems, it provides little value if its owners are not prepared to receive it. While this unexpected windfall may seem like a blessing it all too often becomes more of a curse. Often those…

An Investor’s Version of Rat Park

  Many investors are addicted to overpriced financial products sold by conflicted advisors. The products are not the problem. The toxic environment that allows them to incubate and spread is the main source of this dysfunction. Johann Hari wrote an amazing article in the Huffington Post entitled “The Likely cause of Addiction Has Been Discovered…