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Avoid foolish impulse buys by asking yourself these 4 pre-purchase questions.

 

If you’re feeling blue, hide your green. According to new research published in the journal Psychological Science, sadness can lead to impulsive (and irresponsible) financial choices.

Study participants watched either a sad or neutral video. Then researchers asked them to choose how they’d like to receive a cash reward. They could either receive one sum of money at the end of the session, or receive a bigger reward mailed to them in the future. Participants who watched the neutral video chose the delayed reward 13 to 34 percent more often than people who watched the sad video, according to Jennifer Lerner, Ph.D., director of the Harvard Laboratory for Decision Science and one of the study’s authors. These differences emerged even though real money was at stake.

“Sadness makes people devalue future gains relative to present gains,” Lerner says. In other words, when you’re sad, you’re more focused on the now, rather than the future. You just want to be happy. You don’t care about what happens down the line.”

“This process occurs unconsciously,” Lerner adds. “Decision makers themselves do not recognize that sadness has such effects.” Meaning: If you shop while sad, you could set yourself up for some potential wallet pain and not even know it. (Is the cold weather making you feel more sad than normal? Try these 6 Ways Beat the Winter Blues.)

Before you sprint to the mall, ask yourself these four questions to make sure you’re not being financially shortsighted.

Compliments of: Martha Small | Austin Portfolio Real Estate | 512.587.0308

Original Article by: Vera Sizensky, Women’s Health

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