Hi All!
Happy On-Track Friday! I hope you had a great workweek. As always, here are your weekly tips and tricks to help you meet your personal goals.
1. Losses loom larger than gains.
Losses are more powerful, psychologically, as gains. The irritation you experience over losing $100 is more intense than the happiness you feel from gaining the same amount. The tendency to prefer avoiding losses over acquiring gains is called loss aversion.
In daily life, loss aversion is especially common when it comes to making financial decisions. You are unlikely to buy into a stock if it’s seen as risky, even if the estimated returns are high. Similarly, you would not buy a product that breaks easily because you want to avoid the loss.
2. Aim for inner peace and organize your life around it.
Feelings of anxiety, stress, and worry can spill into all areas of life. Athletes who report feeling stressed outside of their workouts are more prone to injuries when they exercise. Feelings of frustration at work can lead arguments with family at home.
It is important you make inner peace your main goal, and organize all other areas around it. Establish peace of mind, and you’ll find that feelings of calmness spill into other parts of life: health, relationships, finances.
Your Weekly Digest: Fearmongering
This week’s article on MikevanderPoel.com is called, “Why Fear Sells and How it Affects Your Emotions“. I wrote about this topic because much of the marketing material we are exposed to arouses fear. Warranties on physical products prey on the fear that the product might break in the future. Insurance companies remind us to protect our families, homes, and cars because something bad might happen.
Everyone is fearful of something and marketers know it. They know that the fear of loss weighs on us more heavily than gains, and so they use they use fear in their advertisements and commercials. This, however, isn’t necessarily a bad thing, for as long as the product actually protects us from the danger or threat that is being advertised.
Until next week,
Mike van der Poel
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