Money Management Skills

(backadmin) #1


Understanding Your Financial Brain ...................................................


Lecture 1

+


RZGRZHSUHSDUHRXUVHOYHVIRUDQXQFHUWDLQ¿QDQFLDOIXWXUHZKHQ


VRPXFKLVDWVWDNH"0RQH\PDQDJHPHQWUHTXLUHVNQRZOHGJHRI


ILQDQFLDOSURGXFWVLQYHVWPHQWDQGULVNWKHRU\DQGWD[UXOHV%XWLW


DOVRUHTXLUHVDQXQGHUVWDQGLQJRIKRZZHDVIDOOLEOHKXPDQVPDNHPLVWDNHV


,QWKLVFRXUVH\RXZLOOOHDUQWKHPRVWLPSRUWDQWLQIRUPDWLRQ\RXQHHGWR


PDQDJH\RXU¿QDQFHV<RXZLOODOVRJDLQLQVLJKWIURPWKHHPHUJLQJVFLHQFH


RISHUVRQDO¿QDQFLDOGHFLVLRQPDNLQJVRWKDW\RXFDQDYRLGIROORZLQJ\RXU


HPRWLRQVGRZQWKHZURQJSDWK


Financial Decisions and the Brain
% (VSHFLDOO\ZKHQLWFRPHVWR¿QDQFLDOGHFLVLRQVRXUEUDLQLVLQD
FRQVWDQWVWUXJJOH:HNQRZZKDWZHVKRXOGGREXWZHRIWHQGRQ¶W
GR LW7KDW¶V EHFDXVH ZH GRQ¶W KDYH MXVW RQH FRJQLWLYH V\VWHP
ZHKDYHWZRSULPDU\EUDLQSDUWVWKDWLQÀXHQFHKRZZHUHVSRQG
WRPRQH\


% 0RVW$PHULFDQVEHOLHYHWKDWWKH\VKRXOGVDYHPRUHWKDQWKH\DUH
saving for retirement—but not enough to actually do something
DERXWLW:KHQZH¶UHSODQQLQJIRUWKHIXWXUHZHXVHDVPDOOSDUW
RIRXUEUDLQULJKWEHKLQGRXUH\HVFDOOHGWKHSUHIURQWDOFRUWH[7KLV
SDUWRIWKHEUDLQOLNHVWRWKLQNLW¶VLQFRQWURO,QIDFWZKHQIDFHG
ZLWKHYLGHQFHWKDWLW¶VQRWLQFRQWUROLWJRHVWRJUHDWOHQJWKVWR
MXVWLI\ZK\ZHIRUH[DPSOHVROGDOORXUVWRFNDIWHUDPDUNHWFUDVK

% The truth is that the prefrontal cortex we use in conscious decision
PDNLQJLVQ¶WUHDOO\LQFRQWURODWDOO,WKDVEHHQOLNHQHGWRDULGHU
VLWWLQJRQWRSRIDQHOHSKDQW7KHULGHUFDQJHQHUDOO\JXLGHWKH
HOHSKDQWDURXQGMXVW¿QHXQWLO the elephant decides it really wants
WRJRVRPHZKHUHHOVH

% 7KHHOHSKDQWSDUWRIRXUEUDLQLVFDOOHGWKHOLPELFV\VWHP,WLVD


much older part of the brain and takes up much more real estate
Free download pdf