Money = Emotions
Good morning!
Hope you enjoyed a nice 4th of July weekend.
Groucho Marx is quoted as saying,
"I don’t want to belong to any club that would accept me as one of its members.”
Since I don't feel quite as strongly about this as Groucho, I'm happy to share that for the 3rd year in a row, I was included in a "club" of sorts...
The Investopedia 100 Top Financial Advisors of 2021
It's always nice to be recognized among so many great professionals, many of whom I'm happy to call not just colleagues, but also friends.
And I'm thankful for the opportunity to contribute to this recent article in the Atlanta Journal-Constitution about women and financial planning.
And I published another podcast episode about online and affordable estate planning with Andres Mazabel of Trust & Will.
And one more notable update...
As some of you know, on my recent anniversary trip with Elizabeth to Turks & Caicos, we broke a rescue pup out of boarding for a couple of hours to give her some fresh air and let her stretch her legs on the beach.
The rescue organization is Potcake Place and though we did this on 2 separate days with 2 separate puppies, we instantly fell in love with with one of them - a cute little girl named Athena.
Here we are walking on the beach at Grace Bay.
And I'm excited to share that she was recently rescued and now lives in Nevada with her adoptive family.
How cool is that?!?!
Money = Emotions
As I've mentioned in my last couple of weekly letters, there's a lot more to money decisions than good information and rational thought.
In fact, Nobel Prize winning research by Daniel Kahneman back in 2002 argues that 90%+ of all financial decisions are made sub-consciously, driven primarily by intuition & emotion.
Add to this the Nobel Prize winning research by Richard Thaler in 2017 which focused on the "the differences between logical economic assumptions and real-world human behavior. His research not only demonstrates that people behave emotionally when it comes to money; it also shows that in many ways our irrational economic behavior is predictable."
For more on this topic, check out this brief article from financial advisor, Rick Kahler: Money, Emotions, and the Nobel Prize in Economics
Now, think about adding a major life transition to the mix...
Something like retirement, the death of a spouse, divorce, or another major disruption to your normal routine.
If money wasn't already emotional, in the face of one (or more) of these life transitions, it can get REALLY EMOTIONAL in a hurry.
As I've written about before, the best approach - in light of this research - isn't to force ourselves to be more rational or logical.
Instead, it's to make space to recognize and accept our emotions around money.
And around our lives.
Since money permeates - to one degree or another - virtually every facet of our lives.
Related: Your will power is an exhaustible resource.
Rather than fighting your emotions and long-held money scripts, perhaps it makes sense to embrace emotion and it's important role in making better money decisions in the future.
But as you might suspect, it's not a simple as flipping a switch and all of a sudden, you're an emotionally aware decision maker with your money.
The good news is that there is an approach to making your emotions work for you instead of against you when it comes to money.
I'll be writing about this more in the future as well as discussing it with my guests on Women's Retirement Radio.
Hope you'll come along for the journey...
Thank you, as always, for reading.
Until next Wednesday,
Russ