Carl Richards, a Certified Financial Planner and influential author, discusses the 'behavior gap' that leads investors to make poor decisions. He emphasizes the importance of aligning financial strategies with personal values and navigating emotions that affect investing. Richards also sheds light on the shortcomings of the financial advisory industry, advocating for genuine communication and trust between advisors and clients. Additionally, he draws parallels between managing risks in finance and in activities like mountain climbing, urging a focus on experiences over material wealth.
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question_answer ANECDOTE
Sketches Spark Financial Insight
Carl Richards started using sketches when trying to explain financial concepts to clients.
He found visuals helped clients gain insight better than verbal explanations alone.
insights INSIGHT
Simplicity Beats Complexity
The hard part in finance is ignoring noise and complexity, not the simplicity of good investment strategies.
Investing simply and behaving well usually outperforms complicated strategies with poor behavior.
insights INSIGHT
Active Minds Struggle with Passive Investing
Entrepreneurs and developers often struggle with passive investing because they are used to actively fixing problems.
This active mindset can cause poor investment behavior and lower returns in markets.
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Today we are talking with Carl Richards. Carl is a Certified Financial Planner, author, podcaster and educator. He is one of the most influential voices in the financial planning world. The title of his book is The Behavior Gap. In this discussion we get into what the behavior gap is, how big it is, why it is so persistent and what we as investors can do about it. We also talk about the state of the financial advisory industry and why there are not enough "real advisors". We talk about how investors should interact with advisors and how to find a good one. That and more in this compelling discussion.
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