Behavioral Economics

What is Behavioral Economics?

July 9, 2021

Behavioral economics combines psychology and microeconomics to explore how individual consumers and producers make their decisions.

Should I Try to Time the Stock Market?

By Financial Advisor Hans Smith | July 14, 2020

There are two central problems with trying to forecast stock market movements: Investors don't know tomorrow's news, and investors don't know how the market is going to react to tomorrow's news.

Helping you Fight Through Financial Sludge

By Financial Advisor Hans Smith | October 1, 2019

Financial Sludge: Insurance and financial companies deliberately making the process of transferring outbound funds as time consuming and uncomfortable as possible.

Behavioral Biases in investing

By Financial Advisor Josh Kruk | September 24, 2019

Loss aversion demonstrated that for most people, the negative feelings generated from incurring a loss outweigh the positive feelings generated from realizing an equal-sized gain.

Avoiding Inertia

By Financial Advisor Peter Egolf | January 22, 2021

The financial industry has a knack for creating inertia through complexity. Inertia transfers wealth from the average investor to Wall Street.

Rally Racing, Potholes, and Investing

By Financial Advisor Peter Egolf | January 11, 2021

While almost anyone can get into a car and drive, not everyone can do it well. The same principles apply to investing.

Psychology of the Financial Industry

By Financial Advisor Peter Egolf | June 9, 2021

Sunk cost refers to an unrecoverable expenditure. The expenditure is most often time, money, effort, or emotion.

Aim for Average

By Financial Advisor Peter Egolf | June 9, 2021

Too frequently, investors aim for above-average returns (e.g., active investing or stock picking) and end up with sub-par returns, missing out on the average market return.

Budget, Save and Invest

By Financial Advisor Hans Smith | August 17, 2020

Transitioning from the workforce to retirement can be a financially stressful time. Prior to this transition, it's a good time to take a close look at your investment risk, and obtain a solid understanding of your personal cash flows.

Avoiding Action Bias Investment Mistakes Through Patience

By Financial Advisor Katie Bensel | July 1, 2021

We would like to believe that economic decision making is based solely on rational thinking. However, it has been found that up to 70% of economic decision making is emotional and only 30% is rational.¹

Maximizing the Emotional Economy: Behavioral Economics, Gallup, Gallup.com