We often think that emotions only impact inter-personal decisions, however making consequential financial decisions in a heightened emotional state also generally isn’t a good idea.
Behavioral psychologists have identified a few common biases that can undermine our decision-making skills. While some are rooted in emotion, others are what we think of as mental shortcuts our brains might take when we’re making decisions in uncertain situations. Being aware of these biases and developing strategies to manage them are key steps to help in planning a transition to retirement. These biases can include overconfidence, fear of loss and overvaluing something we already have. Reach out to us; we can talk about these topics with you.