The Psychology of Money: Reasonable Is Greater Than Rational

Jan 3

Why is being reasonable the key to long-term success in handling your money? In a world where emotions often intertwine with financial decisions, it's essential to recognize that you're not just a spreadsheet; you're a unique, emotional individual. In this episode, we delve into the importance of balancing reason and emotion in financial planning.

Contrary to the common belief in purely rational decision-making, aiming for reasonability can provide a more realistic and effective approach, ensuring better adherence to financial goals over the long run. Tune in for valuable insights that will transform the way you think about money and financial planning.

What You’ll Learn:

Why being reasonable is essential when dealing with money.
The difference between reasonable and rational.
The importance of remembering you are not a spreadsheet.
Why financial planning can’t be done the same for every person.
The importance of finding your why in your financial goals.

Ideas Worth Sharing:

“A rational investor makes decisions based on numeric facts whereas a reasonable investor takes the social element into account too.” - Matt Stahl
“When you’re thinking about your financial planning process it is very important to work backwards.” - Brad Gotto
“What is going to give you the endurance to stay engaged and stay involved in your finances? It’s normally going to be something reasonable.” - Matt Stahl