Investing Intelligence?

Of course, intelligence doesn’t always translate into wise behavior.

Studies of behavioral finance have found the human brain is more interested in survival than saving. “It turns out that, when it comes to money matters, we are wired to do it all wrong. Our brains have evolved over thousands of years to focus on short-term survival in a dangerous world with limited resources. They were not designed for today’s optimal financial behaviors,” wrote financial psychologist Dr. Brad Klontz, a CNBC contributor.

No one knows how the COVID-19 pandemic will be remembered over time, but it appears to have influenced the way people think about money in some significant ways. An April 2021 Bank of America survey reported:

·    81 percent of participants saved money, that would normally be spent on entertainment, dining, and travel, and set it aside in emergency, savings, and other types of accounts.

·   46 percent used pandemic downtime to put their finances in order.

·  44 percent said their risk tolerance changed: 23 percent became more aggressive and 21 percent more cautious.

If the pandemic has changed your thinking, let’s review your financial plan and your portfolio and align it with your current circumstances and thinking.