Behavioral Finance
A timely conversation
Too few Americans have sufficiently prepared for their financial futures. Lifelong habits and attitudes toward money often influence spending and investing decisions, which can impact the ability to save for a home, pay for college, fund retirement, and cover healthcare costs throughout life.
Behavioral finance strikes at the root of whether investors reach their investment goals. The potential for a changing market landscape — and changing client conversations — makes this a timely and must-have discussion. The link between behavior and financial outcomes is often unseen. Help your clients see clearly.
What is behavioral finance?
It's getting people to behave more rationally regarding their money, beginning with saving more and spending less. It's about helping clients by teaching them to think and behave differently about investing.
Balancing instinct and rational thought
Investors often make investment decisions based on fear, doubt, anxiety, and uncertainty. These decisions are driven by emotion and are often subconscious. They lead to the opposite of what investors actually want: security, certainty, assurance, and financial health.
The good news is these instinctive behaviors can be unlearned and replaced with rational, evidence-driven decisions through the psychology of behavioral finance. Help your clients see the big picture.
Make time work for you
Time impacts every aspect of our lives. We reference it constantly — good times, bad times, the best of times. This extends to investing. When is the right time to buy? When is the right time to sell? How investors handle the relationship between time and money can be the difference between financial success and failure. Help investors navigate this reality by steering their view from the roller coaster of dollar-weighted returns to the calmer waters of time-weighted returns.
Make a human connection
Try talking to your clients' hearts before talking to their minds. Show you care and you are ready and willing to listen. Money and finances are emotive issues — that's what makes us human.
Ask clients to tell you more.
When clients suffer painful anxiety over anticipated portfolio losses, it often leads to irrational financial decisions and poor outcomes. Speak directly to fears and concerns — they want you to. Manage client emotions to help manage their assets.
Gaining perspective
Mark Halloran addresses questions about behavioral finance. Refine your understanding of how taking emotion out of investing can provide better outcomes for your clients — and your business.
The right tools for the job
We have tools to help guide crucial conversations, including: Questions To Start The Conversation, Know Your Numbers, and An Annual Review Checklist.
Learn more
Check out our other thought leadership programs.
Contact us today to discuss behavioral finance techniques that can help set your business apart.
800-851-7555
Transamerica Resources, Inc. is an Aegon company and is affiliated with various companies which include, but are not limited to, insurance companies and broker dealers. Transamerica Resources, Inc. does not offer insurance products or securities. The information provided is for educational purposes only and should not be construed as insurance, securities, ERISA, tax, investment, legal, medical or financial advice or guidance. Please consult your personal independent professionals for answers to your specific questions.