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Have you ever found yourself making financial decisions based on instinct rather than informed choices?
In this episode, Josh Leonard talks about five common behavioral biases that can influence financial decision-making. He addresses loss aversion, confirmation bias, herd mentality, overconfidence, and anchoring bias, illustrating each with real-world examples. He also discusses the influence of laziness and habit on decision-making and suggests a four-step approach to counteract biases: recognition, education, professional advice, and informed decision-making.
Josh discusses:
- Loss aversion and its impact on investment decisions
- Confirmation bias and its influence on perceptions and decision-making
- Herd mentality and the potential financial risks associated with following the crowd
- Overconfidence and its role in guiding risky financial decisions
- Anchoring bias and its impact on decision-making and perceptions of value
- Four steps to outsmarting behavioral biases
- And more