David Adler is the author of “Snap Judgement; When to Trust Your Instincts, When to Ignore Them, and How to Avoid Making Big Money Mistakes”. A summary on Marketwire says that the best way to climb back up to the top of your financial game after this crisis is to be skeptical of your first impressions. Although those judgements work in most other areas of life, it is crucial to research and go into deeper thought when dealing with finances. Adler believes that much of the country’s financial crisis was based on snap judgements by large financial institutions and going with so-called “best practices” instead of thinking decisions through.
The following are the “traps” that Adler urges you to avoid in order to get your finances in order. He urges consumers not to avoid annuities due to the perceived costs because they can “fund a level of eternal consumption”. Although it might seem logical to maintain fallen stocks or mutual funds until they rise, “losing stocks generally continue to lose.” Stock analysts’ choices for the best stocks to buy and sell are usually old news by the time you see them and will no longer be beneficial to you. He says not to assume that your broker is speaking in the terms you are thinking: make sure that all conversations are in after-tax amounts. Don’t just follow the court of public opinion regarding how the market is doing; they aren’t always right. Adler’s advice is simply to think twice before making rapid financial decisions because it is one area in life where first impressions just may not be wise for you.