Some people have trouble sleeping because they worry too much about their investments. I have trouble sleeping when my hair gets too long (or there's a full moon, but that's another story). You might not believe my hair-somnia from looking at my picture, but it's true.
Just as it's often true some of the sagest advice comes from your barber. As I sat in the chair of my tonsorial specialist (he'd hate me calling him that, he'd rather just be called a "barber"), the talk soon turned to the market. I tried to explain to him how the biggest problem 401(k) investors have is information overload. This results in several behavioral anomalies that can harm those same investors (for a good rundown on these, check out "Tips 401k Plan Sponsors Can Use to Help Employees Avoid Risk Aversion," Fiduciary News, October 4, 2011).
Now Hal – that's the name of the guy who cuts my hair – doesn't brook academic jargon well. Hal pooh-poohs terms like "framing," "aggregation," "disposition effect" and "status quo bias." He has a much better word for all this. He calls it overthinking.
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Christopher Carosa
Chris Carosa has been writing a weekly article and monthly column for BenefitsPRO online and BenefitsPRO Magazine since 2011 and is a nationally recognized award-winning writer, researcher and speaker. He’s written seven books, including From Cradle to Retire: The Child IRA; Hey! What’s My Number? – How to Increase the Odds You Will Retire in Comfort; A Pizza The Action: Everything I Ever Learned About Business I Learned By Working in a Pizza Stand at the Erie County Fair; and the widely acclaimed 401(k) Fiduciary Solutions. Carosa is also Chief Contributing Editor of the authoritative trade journal FiduciaryNews.com and publisher of the Mendon-Honeoye Falls-Lima Sentinel, a weekly community newspaper he founded in 1989. Currently serving as President of the National Society of Newspaper Columnists and with more than 1,000 articles published in various publications, he appears regularly in the national media. A “parallel” entrepreneur, he actively runs a handful of businesses, including a small boutique investment adviser, providing hands-on experience for his writing. A trained astrophysicist, he also holds an MBA and has been designated a Certified Trust and Financial Advisor. Share your thoughts and story ideas with him through Facebook (https://www.facebook.com/christophercarosa/)and Twitter (https://twitter.com/ChrisCarosa).
