The Behaviour Gap

The Behavior GapI had the pleasure of being invited recently to a PWL Capital event where the featured speaker was Carl Richards, CFP, author and a New York Times contributor.

His new book The Behaviour Gap – Simple Ways to Stop Doing Dumb Things with Money, is primarily focused on financial investments.  It also explains the confusing gap between what we think and feel, and what we actually do.  These highly transferable life lessons that were not lost on the young urban crowd that attended. 

What’s more, the beauty of Carl’s approach – and how his artwork became featured in the Parsons School of Design in New York – is that he distills the concepts in his book into deceptively clear line drawings that deliver the whole message.  If Carl can’t fit the idea on a cocktail napkin, he’ll work at it until he can.

So what did Carl have to say about financial investing that can be extrapolated to people, patterns of behaviour and careers?  Here are just a few:

  1. We can decide what we really want out of life.  So the more you know about yourself, the better you can align your actions with your goals.
    1. Overconfidence is a serious problem.  The ones who are most overconfident are least likely to recognize it.
    2. We can embrace uncertainty.   Change isn’t always a problem if we can be flexible rather than locked in.
    3. You gotta be you.  You need a strategy that’s made specifically for you.
    4. Happiness is more about expectations and desire than it is about income.
    5. Anxious people tend to get stuck in the past and seek comfort in familiarity.
    6. Good things happen too.

Every summer needs a good book. So, if you’re a reader, enjoy.  If you’re visual and just want see the concepts in sketch form, head to his website, they’re all there.

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