Humans hate to lose. In fact, behavioral economists tell us when it comes to money we hate losing more than twice as much as we like winning. This is called loss aversion, and if we are not careful it can lead to irrational investing decisions. Paul Samuelson, noble winning economist, once tested this theory…
Investing
Why do Over Half of Americans Not Invest in the Stock Market?
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•Saving
Extended Warranties Rarely Pay Off: Put the Odds in Your Favor with a Self-Insurance Fund Instead
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•In my last post I mentioned that extended warranties are one of the worst types of insurance you can buy. The odds are heavily against the purchase of extended warranties working out in your favor. In spite of this many people swear by them and purchase them every time they are offered. Why is this?…
Misc.
Money is a Game of Probability: Guidelines for Buying Insurance
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•Misc.
Money is a Game of Probability: Top 10 Ways to Increase Your Odds of Success
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•I recently wrote about how life is a game of probability, not luck. Money, like life, is also a game of probability. While there is nothing you can do to guarantee financial success, you can do things that will greatly increase your chances. Before getting into the strategies that will swing the odds in your…
Misc.
The Secret Millionaires Club: Warren Buffett Becomes a Cartoon of Himself to Teach Kids About Business and Money
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•After you get your own finances in order, teaching your children basic financial skills is one of the most important things you can do. I agree with Andrew Tobias, who stated the following in his book The Only Investment Guide You’ll Ever Need: “I’m keenly aware that they are your kids, not mine, so I…