Grand Rounds: Human Behavior edition
Welcome to this session of grand rounds, a collection of posts I have found in the blogosphere that I found of interest and hope you do too.
I find human behavior fascinating, in fact I double majored in college with a degree in Biology and Psychology.
There are many instances where the study of human behavior and that of finance intertwine.
In “The Psychology Of Money,” the author provides 20 examples of how certain tendencies in human behavior can make for poor financial decisions.
There is also a wonderful anecdote at the beginning of this post that shows how wrong societal perceptions can be in judging two vastly different individuals on perceived vastly different steps of the socioeconomic ladder.
Continuing with the theme of human behavior, the next post, from Simple Money Man, analyzes 5 different types of human behavior and how each can influence your money decisions in “Money Personality: What’s The Downside of Yours?”
By identifying which personality you tend to gravitate towards, you can make changes to counteract the potential pitfalls associated with it.
In “Framing Your Mind For Money,” Dr. Linus, of Dads Making Cents, offers guidance on how to mentally “reframe” our line of thinking so that we can overcome inherent human behavioral biases, financial or otherwise.
With the right framework, decisions can be made that provide the greatest benefit rather than the knee-jerk reactions marketing gurus rely on to separate you from your money.
It is human nature to see how we measure up against our peers.
While there is some benefit of seeing how you stand amongst your cohort, there are traps that await you that must be navigated around successfully if you want to achieve happiness and contentment.
Like everything else, moderation is key.
Taken to the extreme, constant comparisons with others will breed insecurity and unhappiness.
There is always someone out there who is richer, smarter, more athletic (not hard to do in my case), or better looking.
If I try to measure myself up to these ideals, I will always fall short.
This is self-defeating human behavior, exemplified by Invested Wallet in the post, “Are You On Your Own Personal Finance Journey? Don’t Compare Yourself To Others.”
In, “The Cash Isn’t Always Greener,” Side Hustle Scrubs extols focusing on your own yard instead of peering over the fence as you might be sitting on an oilfield without knowing it.
And finally, the age old behavioral question of which is better, the Carrot or the Stick, can be applied to finances as well.
Attacking your debt does not have to require a monastic type life commitment.
Just like successful long term dieters who realize the benefits of a “Cheat Day,” Finances With Family proposes a similar concept in the post, “How to Stay Motivated While Paying Off Debt Using the Milestone Method.”
These periodic rewards can certainly maintain motivation and break the monotony of continued frugality without drastically prolonging the path to financial independence.
Well I hope you found these posts illuminating and help you undergo behavior modification in a good, financially sound, way.
Have a great weekend.
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