𝘞𝘩𝘢𝘵 𝘪𝘴 𝘵𝘩𝘦 𝘨𝘳𝘦𝘢𝘵𝘦𝘴𝘵 𝘵𝘩𝘳𝘦𝘢𝘵 𝘵𝘰 𝘺𝘰𝘶𝘳 𝘸𝘦𝘢𝘭𝘵𝘩?

A Wedding? Volatility? Inflation? Shifting tax codes? A sudden lawsuit?

While I am not a licensed psychologist, I am a Wealthcare Provider.

As such, I discuss private and confidential information on a daily basis. To most citizens of the United States, money is one of the most sensitive topics which is discussed within their personal lives.

The conversation never fails to lead to cognitive or emotional bias, in one manner or another. These characteristics tend to impact every decision which is made, ensuring the inevitable dialogue with clients. This phenomenon can be explained through the lens of evidence-based behavioral biases.

Illusion of Control Bias occurs when people believe they have control, or an ability to predict circumstances which they have no influence over.

By searching for external threats, investors are frequently searching for an information advantage relative to the market.

An adage in the industry is that markets will perform as a voting machine in the short-term. That is, as daily movements are driven by popular sentiment, news, fear, greed, and speculation. Investors "vote" with their money.

Over long time periods, the market tends to act more so as a weighing machine, objectively measuring a company's intrinsic value, including earnings, cash flow, and financial strength.

If investors are able to access valuable information which is not reflected within the current share price, this provides an advantage over other market participants. This action shifts focus from the things they can actually control, such as their own savings rate, asset allocation, and emotional discipline.

Self-Attribution Bias is the cognitive habit of taking personal credit for financial successes, while blaming other factors for financial failures.

We have a natural inclination to search for external forces to dismantle our wealth because it protects our egos. It is much easier to point a finger at an external villain than it is to admit that a lack of financial literacy or an uneducated, emotionally driven action caused the damage.

Availability bias causes people to estimate the probability of an event based on how recently, this comes to mind.

The human brain naturally prioritizes in favor of availability bias, therefore it is essential to remain focused. We are pulled to these forces as our environment convinces us they are the only threats that matter, one of our many internal cognitive blind spots.

Now, at last, if you will indulge, if only, for a moment.

Overconfidence bias leads investors to overestimate their knowledge, abilities, and the precision of their information.

When an investor feels they possess a great level of expertise, a feeling of confidence above which is justified may capture their mind. The only possible derailment to the financial plan of a woman or man who has 'overconfident' tendencies, is an unfair practice or poor luck.

What is the greatest risk to your wealth?

I want to plant a concept in your mind. A concept which I encourage you to maintain for the remainder of your life.

The greatest threat to wealth is the human mind.

As a fiduciary, my oath as a Wealthcare Provider is to act in the best interest of the clients whom I represent. I started writing this article at 4:10 AM sitting within the lobby of Omni, Los Angeles. The audience may be able to determine the number of interruptions in the day, based on the delivery time.

After a red-eye from the Daniel K. Inouye International Airport in Honolulu, the remainder of the day was immersed in discussing state-of-the-art research with the Chartered Financial Analyst Society of Los Angeles.

If any are in the area, please visit the Omni, we will have a bite and explore the venue, as I would love to see you. While accompanied by a level of exhaustion that is rare, I have always found the suffering worthwhile. When it comes to guarding client wealth, staying ahead of the curve, and bad actors, is essential.

As Ruth Bader Ginsburg so fiercely stated, "fight for the things that you care about, but do it in a way that will lead others to join you."

I was moved by Her statement, perhaps due to my tendency to value Human Capital above all. There is nothing more rewarding than earning the trust of another human, and I feel privileged by the consideration alone.

Sincerely, I strive to collaborate with those who are actively achieving, or are on the path to achieving greatness, regardless of how the term is defined.