Money Does Boost Happiness, But Not The Way We Think It Does | Daniel Crosby
The clearest indicators of our financial solvency are based on the behaviors we exhibit with our investments. Dr. Daniel Crosby PhD is a psychologist, behavioral finance expert, asset manager and bestselling author of four books including The Behavioral Investor. We examine with him the question of whether financial success ultimately brings us happiness? Surprisingly it can, but not in the ways that we think it does.
Having studied the growing list of 200 odd behavioral biases and heuristics, Daniel has whittled them down to what he describes as the four “Big Daddy” biases: ego, emotion, attention and conservatism. We learn about why these matter so much and interestingly what Coke Zero can teach us about our biases!
Daniel touches on his other bestselling book You’re Not That Great which refreshingly embraces the fact that we are in fact all fairly average! That self esteem is built not by awarding prizes for participation, but by taking a risk, working hard and acknowledging that occasionally we will fall flat on our face along the way!
In our Grooving Session with Kurt and Tim, following our interview with Daniel we talk about the ways that we can apply Daniel’s insights to improve our wellbeing and our relationships. [Tim quotes the infamous “Man in the Arena ” quote from Theodore Roosevelt but apologies, we incorrectly credited the quote to Eisenhower, not Roosevelt in the episode.]
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(3:09) Welcome and speed round.
(5:51) Why understanding people is vital to understanding markets.
(8:20) Daniel’s journey into behavioral finance.
(11:02) What behavioral finance can help with beyond your bank balance.
(15:17) Can money really boost our happiness?
(20:05) The benefits of embracing our mediocrity.
(24:30) How stress impacts performance.
(26:58) Meta-biases: ego, promotion, attention, conservatism.
(31:09) What Coke Zero can teach us about conservatism bias.
(36:51) Ethics and behavioral finance.
(41:09) What music does Daniel invest in?
(48:44) Grooving Session on how to apply Daniel’s work in our own lives.
© 2021 Behavioral Grooves
Books by Daniel Crosby
The Laws of Wealth: Psychology and the secret to investing success: https://amzn.to/36NsbuJ
The Behavioral Investor: https://amzn.to/3Bl4s3t
You’re Not That Great: https://amzn.to/3ifiRFC
Personal Benchmark: Integrating Behavioral Finance and Investment Management https://amzn.to/3h5TjM1
Other Episodes You Will Enjoy
Barry Ritholtz, Episode 47. How to Reduce Evolutionary Panic
Seth Stephens-Davidowitz, Episode 246. Are You More Honest with Google or Your Friends?
Vanessa Bohns, Episode 253. Why You Don‘t Need to be Powerful to be Influential
Ben Parr, Episode 237. Attention: How to Capture It and Keep It with Ben Parr