Drawing on the latest scientific research, Jason Zweig shows what happens in your brain when you think about money and tells investors how to take practical, simple steps to avoid common mistakes and become more successful.
What happens inside our brains when we think about money? Quite a lot, actually, and some of it isn’t good for our financial health. In Your Money and Your Brain, Jason Zweig explains why smart people make stupid financial decisions—and what they can do to avoid these mistakes. Zweig, a veteran financial journalist, draws on the latest research in neuroeconomics, a fascinating new discipline that combines psychology, neuroscience, and economics to better understand financial decision making. He shows why we often misunderstand risk and why we tend to be overconfident about our investment decisions. Your Money and Your Brain offers some radical new insights into investing and shows investors how to take control of the battlefield between reason and emotion.
Your Money and Your Brain is as entertaining as it is enlightening. In the course of his research, Zweig visited leading neuroscience laboratories and subjected himself to numerous experiments. He blends anecdotes from these experiences with stories about investing mistakes, including confessions of stupidity from some highly successful people. Then he draws lessons and offers original practical steps that investors can take to make wiser decisions.
Anyone who has ever looked back on a financial decision and said, “How could I have been so stupid?” will benefit from reading this book.
It's tempting to blame your upbringing or your stingy boss, but the real culprit in your flawed relationship with money is your very own brain, argues finance writer Zweig. Combining concepts in neuroscience, economics and psychology, he explains how our biology drives us toward good or bad investment decision. Our brains are pretty self-deceptive, it turns out: we have difficulty admitting our lack of knowledge about finances; we overestimate our own wisdom and performance; and our preference for mistakes of action rather than inaction often leads us to irrational investment decisions. Most tellingly, "humans believe we're smart enough to forecast the future even when we have been explicitly told that it is unpredictable." Among the book's fun facts: the MRI brain scan of a cocaine addict is virtually identical to that of someone who thinks he is about to make money. Backed by stellar research and written in an entertaining, informal style that makes a complex subject accessible to the layperson, Zweig makes clear how we can understand what our brains are doing and how to use that knowledge to get out of our own way and invest wisely.
Love the detailed information. Unique studies serve as example as to what we already believe to be true. Awesome information.
Honestly, when I looked at the contents list, I was exited about the name of every chapter. I said to myself that's what I need a book illustrates the relation between mental human nature and money, but after I bought it I was shocked. I didn't match my expectation. It was all about scientific terms that drive you from investing atmosphere.
If you asked me now, I'll say I would never buy it.