Today on the show we are taking about the influence of feelings in the decision making process. As investors and as humans in general, we tend towards making decisions based on feelings over rational and well-balanced data collection, that is just part of how we are wired. Here at the Rational Reminder Podcast we want to remind everyone of the importance of balancing these feelings with rationality. This does not mean that we should be making decisions without feelings but just to keep in mind our own biases and how these work to our detriment. In our discussion we cover what a good decision might look like, the two systems of thought as detailed by Daniel Kahneman and the importance of framing when approaching a weighty choice. We also run through a little on the safe savings rate and the ETF model portfolio. We end off with some useful strategies that can help you to make better decisions, especially when it comes to your money. For all this and a whole lot more, be sure to tune in today!
Key Points From This Episode:
The recurrence of feelings in decision making. [0:03:56.5]
Lack of data in the safe savings rate research. [0:05:18.2]
The ETF model portfolio and where to find it online. [0:10:53.8]
A few of the twenty craziest investing facts ever! [0:12:13.5]
What is a good money decision? [0:15:06.1]
Confirmation bias and influences on our decision making. [0:18:50.9]
Kahneman and the two systems of thought. [0:20:10.9]
The effects of past experiences on our current strategy. [0:24:46.3]
Framing as part of the discussion and decision making process. [0:27:36.2]
Four things you can do to implement better decision making. [0:30:12.6]
And much more!