Recency Bias Investing: Why “What’s Working Now” Is the Worst Signal You Can Follow
Between January 2016 and December 2025, U.S. mutual funds and ETFs returned 9.9% a year. The average dollar actually invested in those same funds earned…
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Sunk Cost Fallacy Personal Finance Decisions: A $6,300 Case Study in Letting Go
In 1985, two psychologists asked people to imagine they were an airline president who had already sunk $9 million into a plane a competitor had…
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Present Bias and Retirement Contributions: Why “Just Save More” Almost Never Works
In a study of one mid-sized manufacturing company, workers who were asked to commit to saving more later raised their average savings rate from 3.5%…
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The Diderot Effect: Why “Buy It Once, Buy It Right” Quietly Costs More
In 1769, Denis Diderot was given a scarlet dressing gown. Within a year he had replaced his desk, his chair, his prints, his bookshelves, and…
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The Planning Fallacy in Personal Finance: Why a $30,000 Kitchen Closes at $41,000
Thirty-seven psychology students were asked how long their senior thesis would take. Their average estimate was 33.9 days. The average actual completion time was 55.5…
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Does Paying With Cash Make You Spend Less? What 392 Studies Actually Found
In 2001, two MIT researchers ran an auction for Boston Celtics tickets and found that bidders told to pay by credit card bid roughly twice…
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Framing Effect Pricing Psychology: Why Knowing About It Doesn’t Protect Your Wallet (2026)
In 1981, two psychologists handed 307 people a choice between two public health programs. The programs were mathematically identical. Depending on which set of sentences…
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Confirmation Bias Investing: Why More Research Makes You More Certain and Less Right
Over the ten years ending December 2024, the average dollar invested in U.S. mutual funds and ETFs earned 7.0% a year while the funds themselves…
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Overconfidence Bias Stock Picking: Why Doing Your Own Research Makes It Worse
Between 1991 and 1996, the households that traded most actively in their brokerage accounts earned 11.4% a year. The market returned 17.9% over the same…
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How to Stop Impulse Buying Online: The 6-Step Friction System That Cuts Unplanned Spending in 30 Days (2026)
Pull up your card statement from the last 90 days and count the online purchases you can no longer name. If the number crosses ten,…
