David Alexander, assistant professor of marketing in Opus College of Business at the University of St. Thomas, was highlighted as an expert in MoneyGeek on behavioral finance.
From the Q&A:
As it relates to personal finance, what do you think is the most important thing individuals need to know about behavioral finance?
Perhaps the most important thing for individuals to know about behavioral finance is that it has its greatest effects when you are making hard decisions. “Hard” can be defined in a number of ways, but at its core, hard refers to decisions you don’t have experience making, involve complex or hard-to-make cost-benefit trade-offs, require effort and are typically important to us in some way. Our brains aren't optimized for making financial decisions, so they look for shortcuts that produce “good enough” rather than perfect decisions. It is this willingness to trade off accuracy and effort that behavioral finance is using to influence our decisions.