Now is a great time to start tackling those big decisions you have been putting off ‘until next year’.
But before you do, it’s important to reflect on your ‘thinking’ process about those decisions.
For instance, do you make decisions automatically, decisively, instinctively? Or do you go about it in a more deliberate way, preferring to weigh up all the options in a slower, logical, ordered process?
In his book Thinking, Fast and Slow, prominent international psychologist and Nobel laureate Danny Kahneman talks about how these two divergent ways of thinking impact our judgments and decisions in life.
Whether you are more inclined to a speedy, intuitive view, or want to consider every possibility and take so long that it borders on indecision, it’s important to recognise which approach is guiding your choices.
And so it is with investing.
For instance, the human flaw of over-confidence can be a real disadvantage if you don’t recognize and address that inbuilt bias towards impulsive decisions.
Likewise, over-analysing everything and not being decisive enough can lead to missed opportunities. It can create what is widely recognized and known as “analysis paralysis”. In other words, over-thinking it and delaying decision-making – fired by anxiety about fear of losing money as much as fear of missing out – can be as risky as diving into investments based on instinct alone.
The message here is that even if we think we know ourselves well, it’s good to step outside of what we know, cast off any inherent bias we might have about certain financial strategies or products, and look at the bigger picture. In other words, consider new options with an open mind.
The best way to do that is to get impartial advice.
For those who are used to thinking things through more slowly, the sheer number of options can be daunting. Impartial advice narrows down the choices – making it easier for the more cautious to make a final decision.
At Warr Hunt, we’re not here to make decisions for you or tell you how to make them. But our step-by-step planning enables you to get a clear assessment of all the pros and cons, as well as identify any pre-conceived views you hold.
Human behaviour, especially when applied to financial decisions, can be complex. So impartial advice is crucial in maintaining perspective and helping you weigh up decisions. It broadens your approach, and channels those inbuilt instincts and views you hold into clear, financial advice that works for you.
Sam Hunt - "I have a genuine desire to help our clients achieve what is most important to them, by giving them clarity around the important financial decisions they face."