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How good are you at making financial decisions? Are you able to analyze a situation and quickly make a decision? Or are you a “waffler,” finding it tough to make decisions and putting things off until the last minute or the minute after the last minute?
The fact is that the health of your finances is tied very closely to how good a financial decision maker you are. Whether you're poor, rich or someplace in the middle depends a great deal on the quality of your financial decisions. Some people were fortunate enough to be born into very advantageous circumsta
According to Rob Jupille, president of a California-based financial management firm, one of the major reasons why people make poor financial decisions is because they let their emotions take over. And, unfortunately, one of these emotions that often drives decisions is fear. He believes this is especially true when it comes to selling stocks. When people see what's happened in the market due to a significant change such as Brixit, fear tends to take over and they end up selling stocks they should've held onto. What he suggests to counteract this is to not make a decision until you have asked yourself the question has anything changed besides the stock market that would cause you to buy or sell stocks. If the answer is no, then don’t either sell or buy.
For that matter, Jupille has also said that sometimes all you need to do is just take a couple of deep breaths before making a financial decision as this could keep you from making a poor one.
5. Just make a decision
Crystal Stranger, a California tax accountant, reminds us that to not make a decision is to make a decision. While, yes, you do want to weigh the positives and negatives and think seriously about the decision you are about to make, you will eventually have to decide something. She points out that sometimes, it's more important to just make a decision of some kind than to not make one.
For example, if you continually waffle about saving for your kids' college educations, your retirement or about having a will drawn up but actually do nothing you may find that you have practically no time left to do anything. She further points out that the more decisions you make the easier it becomes to make good ones as you will become a stronger decision-maker.
Use both sides of your brain
Finally, here's a short video explaining how you can make better financial decisions by using both sides of your brain.