Where Money Intersects with Meaning
Episode 34 with Dr. Daniel Crosby
When asked to describe what he does, today’s guest says that he deals with the messiness of money as it intersects with the strangeness and oddity of being a human being.
Where money intersects with meaning, you’ll find psychologist, behavioral finance expert, podcaster, and author of the new book Soul of Wealth, 50 Reflections on Money and Meaning, Dr. Daniel Crosby. In this fascinating and illuminating conversation, Daniel joins Wes and Sonya to dissect how our behaviors and understanding of money can open a pathway to the things that really matter.
About Our Guest:
Educated at Brigham Young and Emory Universities, Dr. Daniel Crosby is a psychologist and behavioral finance expert who helps organizations understand the intersection of mind and markets.
Dr. Crosby's first book, Personal Benchmark: Integrating Behavioral Finance and Investment Management, was a New York Times bestseller. His second book, The Laws of Wealth, was named the best investment book of 2017 by the Axiom Business Book Awards and has been translated into Japanese, Chinese, Vietnamese and German. His latest work, The Behavioral Investor, is an in-depth look at how sociology, psychology and neurology all impact investment decision-making.
Daniel was named one of the “12 Thinkers to Watch” by Monster.com, a “Financial Blogger You Should Be Reading” by AARP and a member of InvestmentNews prestigious "40 Under 40". When he is not consulting around market psychology, Daniel enjoys independent films, fanatically following St. Louis Cardinals baseball, and spending time with his wife and three children.
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Dr. Daniel Crosby 00:00
One of the hardest things, I think, for us to grasp is that facts have almost nothing to do with behavior. So I think emotion is a big piece to it. The other way to think about it is the palatability of a question, right? So we know all about Super palatable food. Some food is tastier than other food, right? Doritos are tastier than broccoli because they're super palatable, right? Like we have engineered them, we have weaponized them to be delicious, and it worked, and information has been weaponized to become super palatable as well. A lot of truth is very tedious and boring, right? A lot of truisms about putting together your financial life would take a while to explain. Would take a level of financial literacy to understand. But like XYZ stock is going to the moon, is very easy to understand or run sell everything the palatability of truth has a great deal to do with it, and just sometimes, the way things are marketed to us are to get us to act Regardless of the advisability of the thing in question. You Hello
Wes Brown 01:23
and welcome to analog advisement, where we explore how money shapes our lives, futures, families and communities. I'm Wes Brown and I'm Sonia Luter, whether you're managing your own family's wealth or just curious about the world of wealth management, this conversation will enlighten and inform. Thanks for being here and for tuning in. Hey guys, today, I'm excited to introduce to you a new friend, psychologist and behavioral finance expert, podcaster and Author, Dr Daniel Crosby, with such a unique and diverse background, Daniel is an exceptional fit for the show. He helps organizations and individuals understand the intersection of mind and markets today, he joined my co host Sonia and me to discuss the inception of his new book out now, the soul of wealth, 50 reflections on money and meaning. It was such a rich conversation and a fascinating experience to be caught in the middle of two therapists who are also financial experts. Sonia and Daniel's rapport and expertise brought a lively banter to this episode, and I loved picking their brains about the intersection of psychology, money and purpose. Discover what compels Daniel to help people get their money right, and why he thinks it opens a pathway to everything else that really matters. Buckle up. This is a great conversation. Let's get analog!
02:40
Yeah. Well, Daniel,
Wes Brown 02:44
thanks for joining us. We appreciate you coming on on the podcast. You know, I know you and Sonia have been in the same circles for a long time. You and I have been adjacent to each other in a professional capacity and regionally here for a few years. I think we actually connected online probably a dozen years ago. So it's good. Finally, talk to you in person. We'd love to start off every interview and episode with just asking people to kind of tell us kind of what they do and kind of the high points of what led to where they are today. So if you wouldn't mind, love to have you kick us off in that way. Yeah.
Dr. Daniel Crosby 03:19
Daniel Crosby, I'm the Chief behavioral officer at Orion Advisor solutions, and I have a gloriously messy job like my job is a little bit of everything. My elevator speech for the job is training, tools and technology around the psychology of money, but I do a lot of public speaking. I have a podcast myself. I write books. I oversee the CE educational arm that we have called the Orion Advisor Academy. That's free CE for advisors. And I've also gotten to help our tech team build a lot of sort of behaviorally informed tools. We have a risk tolerance questionnaire that measures behavioral preferences, goals based, wealth management platform, sort of a psychology of money, Personality Inventory, financial wellness measures. It's a fun job that sees me get to do a little bit of everything in this space, and the way I got here, I mean, we can go as deep as you want, but I'm a clinical psychologist by education. And the short story is I just I burned out like when I was, you know, when I was in grad school. I started my PhD when I was 23 so I was, you know, a good age to be giving people life advice. I think at 2023, and I really just was taking my work home with me. I, you know, talking to 40 people a week who were having a really tough time, had poor boundaries, frankly, and just couldn't do it. But I. Loved thinking about what makes people tick, and so I came to my dad, and when I was like, 2526 and my dad was, and is a financial advisor, and I said, Hey, I love thinking deeply about human behavior, but I do not love doing it in a medical context. So what do you you know? What do you got like? What are there other avenues I could pursue? And he said to me that there's a ton of psychology in my work. And at the time, I understood my dad to be one part stock picker and one part salesperson. And so this, you know, kind of confused me. Why he would say there was psychology in his work, but that was really the conversation that put me on the path to end up where I am today. After, you know, lots of, lots of stuff in between, was sort of this epiphany I had that there is a lot of a lot of psychology in every act of an advisor with
Dr. Sonya Lutter 05:58
work you do have a very messy job, and it's a really fun job. They're probably only a handful of other people who have such a job, and it makes it very difficult, especially when you work from home, to tell people what it is that you do. So I'm super curious what you tell your children you do. Oh,
Dr. Daniel Crosby 06:16
so my children, they don't get the short version. They get the long version. So
Wes Brown 06:20
I get the lecture,
Dr. Daniel Crosby 06:23
actually, so Well, guess we're not on video, but I got the copy of my new book here, the soul of wealth, and my son, who's 10, was literally the first person besides my editor, to read the book like he's got to go look this food ain't free. So, yeah, but I tell my kids know that I deal with sort of, you know, the messiness of money, right? Like the money as it intersects with the strangeness and the oddity of being a human being. But then that's the bullet point. But then I make them do the deep dive too.
Dr. Sonya Lutter 06:58
How does your dad feel about what you do now? Oh, he's very he's very proud. He's
Dr. Daniel Crosby 07:02
my biggest cheerleader, and he gives away more books than probably anyone I know. So if you go see my dad, you're gonna get a free book, but you're gonna get a long laundry list of my accomplishments as well. So my dad's great. He's, he's, he's very proud. And he's, you know, in addition to being a great dad, he's a great career mentor, as it turns out. So that's what's worked out. Well, amazing.
Dr. Sonya Lutter 07:27
We do want to talk about your book. Let's do it. It just came out, the soul of wealth, 50 reflections on money and meaning. Are you going to tell us what all 50 of them are?
Dr. Daniel Crosby 07:39
Yeah, let's go. I've got them memorized.
Dr. Sonya Lutter 07:41
We have less than 50 minutes. So you're,
Dr. Daniel Crosby 07:44
I'm gonna go kind of Alabama auctioneer on us. No, that's, that's why I did 50 because I feel in the past like you go on a podcast and people kind of picked your book apart too thoroughly, and there's no reason to buy it. When you write a 50 chapter book, no podcast. Can
Wes Brown 08:03
cover it all.
Dr. Daniel Crosby 08:05
The story of why there's 50 chapters is, is a little interesting. I I wrote about 80 pages of this book. I knew I wanted to write a book on money and meaning. I'm a big Victor Frankl devotee. I'm a big Soren Kierkegaard guy like, you know, any of this sort of fringe existentialism is really my thing. So all this sort of humankind search for meaning is always sort of my greatest interest area and my greatest concern. And I was like, I need to write a book about about money and meaning. And I started to write the book in a similar format to my previous books, which is pretty traditional, you know, 10 or 12 chapters of 20, you know, 20 or 30 pages a piece, and I wrote about 80 pages of the soul of wealth in that format. And it sucked, like it was horrible. It never clicked. It was clunky. And I've historically been a fast writer, like it came quickly to me, and it was fluid, and this was just so bad. And so I scrapped it, which is really hard to do right, to write many pages of something, and then to just be like, Nah, like that will never see daylight, because it's not good. But during my depression about having scrapped 80 pages of hard work, I started reading a a light book. Mostly I read psychology books. I'm like a true nerd, like 99% of what I read is psychology books or philosophy books. So I started reading this book by Rick Rubin, who is a music producer who worked with Jay Z and the Beastie Boys and all these folks. He's like, kind of this glorious hippie, like he's got this HBO show you should watch if you haven't yet. It's just he has the best job in the world. He just kind of, like. Like gives his vibes to other creative people, and like helps them get good vibes too, and gets paid a lot for it. So Rick Rubin's book was called the creative act, and it's like 74 chapters long, but each chapter is three pages long, and as a tired employee and dad and husband like I try and read every day, but by the time I get to my book, I'm a little beat up candidly, and it was the perfect format for me to, you know, to feel like I was making progress, to get these little nuggets of wisdom from from Mr. Rubin. And so I resolved that I wanted to write the soul of wealth in a similar fashion. And once I started writing it in this short essay format, the work came so fast, it was so fluid, it was so easy, I had kind of found the right vehicle, and every chapter follows a similar framework. Every chapter, it starts off with a historical anecdote, or sort of a story, and then it goes to some of the research on the concept in question, and then it goes to sort of life application. So it's like, what's the story, what's the studies? And then what's sort of the this. So what of it? And once I figured out that format, thanks to Rick Rubin, it really was. It was a joy to write.
Dr. Sonya Lutter 11:28
This is all a little bit ironic, because, as you might recall, Daniel, you made fun of me for my book love and money because it was so short. And I was like, listen, people can't consume large bites at a time. You got to be quick and short about it.
Dr. Daniel Crosby 11:45
My book is 273, pages long.
Dr. Sonya Lutter 11:48
Oh no, it's
Dr. Daniel Crosby 11:49
not just presented in short bites. But yes, your book is excellent, by the way. But yeah, you're smart. You're charging a premium for a short book. I'm not mad at this Go, go, get paid. I loved it. I got, I got well more than what I paid for it. Out
Dr. Sonya Lutter 12:08
of it, it's like 1000s of dollars worth of therapy.
Dr. Daniel Crosby 12:12
Well, your book is like, it is like a workbook, almost, or like a therapy session, which is what, couple 100 bucks an hour easy. It's
Dr. Sonya Lutter 12:20
a bargain. It's
Dr. Daniel Crosby 12:21
a bargain. Totally
Dr. Sonya Lutter 12:22
agree.
Wes Brown 12:23
So, you know, I'm curious, the pieces of wisdom that you kicked off every chapter in your book. How'd you come up with those? Yeah,
Dr. Daniel Crosby 12:30
so, like, I'll read a couple of examples, right? Like, so one of the, one of the chapters is titled, take the worst case off the table. I just picked one out of the air, right? Okay, to take the worst case off the table, that is a financial principle that I think has some power. But in order to make it more memorable, I wanted to talk about a story, because that's how I think, and that's how I think most people think. And so for that story in particular, I talk about the Hyundai assurance program. So during the great financial crisis, of course, you know, Detroit was, you know, up against the ropes. Nobody's buying new cars when you know that you're you're scared you might lose your job, and the economy's in the toilet. And so car sales were drying up in a huge way. But Hyundai did this thing that was genius, and they did this Hyundai assurance program, which said, Hey, if you buy a new Hyundai and you lose your job, we'll take it back, no questions asked, and we'll give you the full purchase price of the car back. Because this worst case scenario, I mean, like, what was unemployment during the GFC, like 9% or something. So 91% of people keep their jobs, but effectively, 100% of people are worried that they won't. And so Hyundai understood those odds and said, Hey, we're going to take the worst case off the table, right? We're going to take the worst case off the table for you, and we're going to give you your money back if you lose your job. And they had one of their best quarters ever, because they understood this principle, right? So there's some accompanying psychological principles, right, like status quo proneness and loss aversion and Prospect Theory. And so then, you know, I can talk about those, and then I can talk about it in a personal finance application where things like a safety bucket or a safety account or having adequate insurance could serve a similar purpose for people. So there have been a million books written about the need for a safety account or, you know, a safety bucket or adequate insurance. That's not especially compelling to me. It's hopefully a little more interesting that each of these sort of truisms, these sort of evergreen truisms about our financial lives, are paired with historical or business anecdotes. That I think are maybe a little more interesting and memorable than than just the, you know, the dry delivery of the advice itself.
Dr. Sonya Lutter 15:08
Are you ready for a hard question always, I know you can handle it, and I'm sure you'll have some smart aleck response for me. So that's a really fun story and a good headline for the chapter, and how do people find meaning in that? So it's 50 reflections on money and meaning. So tell me more about the connection back to purpose, fulfillment, contentment.
Dr. Daniel Crosby 15:33
Well, there are definitely some chapters that are more directly tied into, you know, the meaning, the contentment, the purpose, the happiness chapter than that one. But you know, to go with the hard question and not to dodge
Wes Brown 15:46
dueling therapists. I just want to say that right now you guys are just gonna be out maneuvering each other,
Dr. Daniel Crosby 15:54
Mom and Dad fighting. I think one of the things that that, that I love about this work, and I'll put words in your mouth and imagine that you do too, is that money by itself is not all that interesting. Like you know money, money by itself is not all that interesting. But since money touches every part of our lives, uh, figuring out your financial life has the ability to elevate every other part of your life, you know, and Gandhi, I'm paraphrasing, but Gandhi has this idea that to a poor person, bread is God, right? If you if you have no money, and all you can think about is, is where your next meal is coming from. But when those bottom rungs of of Maslow's hierarchy start to get squared away with with adequate material resources and adequate wealth, that's when the good stuff kicks in, right? You can start to worry about love and friendship and God and purpose, and, you know, whatever else. So I'm highly motivated to help people get their money right, not because it is interesting, per se, I think it's quite boring, but because it opens up a pathway to what really matters, which is, frankly, everything but money. Yeah,
Dr. Sonya Lutter 17:19
that's great. I was also reading about something you posted recently on resilience, and I'm wondering if that plays into the book or not. If it doesn't, let's talk about it anyway, because I love this idea of when people do struggle, there are some people who seem to recover and thrive, and other people who just never seem to crawl out of that low spot. And I don't know if you were posing it as a question that has went unanswered, I think we have some evidence that points toward resiliency and maybe experiencing some hardship, and the ability to recover from little hardships along the way is the identifying factor. But I would love to hear your thoughts and if that comes into this book or not. So
Dr. Daniel Crosby 18:04
I'm actually just gonna continue to write about meaning and purpose, like going forward. This book got me hooked on it, so what you saw me post the other day is from a future book. It's not from this book, but it's it's research on what's called Post Traumatic Growth, right? And so let me see if I can remember the research in particular. So it was about soldiers. It was like they interviewed 1000s of soldiers, and understandably, most of them had emerged from war zones worse off, which is sort of our expectation, right? Like you, you go experience hard things. You see atrocities, you see violence, and that is to your detriment, like that's to the detriment of your spirit. And indeed, that's what happened with most of them. But there was a minority of folks who experienced what's called Post Traumatic Growth, right? We know about post traumatic stress that all makes sense, but post traumatic growth is when something hard happens to you and you're better for it. And there were three variables, and candidly, I can only remember two off the top of my head, but there were three variables that predicted which soldiers experienced the growth from from those who didn't, and the two that I can remember, the first was gratitude, right? So sort of a reframing of this experience, to be grateful not to perseverate on the things that you don't have or the bad things that happened, but to be grateful for the good parts of it and the lessons learned. And then the other one was social support. And social support. I mean, people are going to read about social support in the soul of wealth again and again. If you wanted to live a happy life and you wanted to live a meaningful life, and you could only optimize for one thing, you should optimize for relationships and the the impact of. Social support and relationships is so it's like science fiction. You know, when you when you look at the Blue Zones, research on people who live a long time, most there's like, nine factors. Most of the factors are kind of stuff you think, like, okay, like, yeah, people in Okinawa live a long time because they eat seaweed and fish like, yep, that makes sense. But then three of the nine factors are a little counterintuitive, because they're all about social support and close knit social ties and friendship and a supportive spouse and things like that. And you've got people in Italy, you know, smoking unfiltered cigarettes, eating cheese and pasta, and, you know, processed heat all day, living to be 100 years old because they have such strong social networks. And you know, you see the same thing with post traumatic growth a lot of times, the dividing line between whether a hardship breaks you or whether it makes you is who's in your corner and who's surrounding you, walking through the fire with you through that tough time. Yeah,
Dr. Sonya Lutter 21:11
I'm sure you cited in this soul of wealth the Harvard happiness study, and it's similar to the blue zone research, and in the Harvard study, they consistently point toward over 100 years, there's evidence to say it's the social relationships that matter. I
Wes Brown 21:30
saw the post that Sonia is referencing. I think the third thing was, could it have been purpose
Dr. Daniel Crosby 21:34
plus purpose? And it was a book, a book I'm working on, on purpose. So that should have been a gimme, but it was perfect.
Wes Brown 21:42
I wasn't trying to, I wasn't trying to throw you into the bus or, you know, trip you up there. But, yeah, it was a great post. I It caught my eye as well. You know, Sonia knows, and it's like a bad habit that I have to always ask about social media. And, you know, a bit ironic, considering we were just referencing a social media post that you you made. But you know, just yesterday,
Dr. Sonya Lutter 22:03
there is some good that comes from social media. There is, yeah, absolutely,
Wes Brown 22:07
I was talking with someone yesterday, specifically about relationships, and what I guess I'm observing to be a lack of resiliency when it comes to relationship building. And I'm wondering this is really a question for the two of you. Sonia, you should weigh in as well, but what your feelings are around social media's role in that? And I what surfaced for me was this observation that like building relationships, and the work that that takes to build meaningful relationships and to build resilient relationships has been undermined or cheapened by friend requests, right? I'm observing this within a particular age group, mostly those that spend a lot of time on social media, that probably the most time. But what are your thoughts around that? I mean, because certainly there's a there's a difference in the again, holding up air quotes. There's a difference in the friendships that you have social media platform versus the meaningful relationships that would lead to post traumatic growth. Dr Luter,
Dr. Sonya Lutter 23:10
I was literally almost to say Dr Crosby,
Wes Brown 23:17
I know not to put you on the spot, but I I'm curious what your thoughts are around that just because of the emphasis that you put on the value of relationships,
Dr. Sonya Lutter 23:25
for me, it points toward quality over quantity. And I do think that some people can have those quality connections virtually. I don't doubt that one bit that for some people, that is their safe place and that ability to connect in a way that they can share their feelings and their their dreams and their vision. It's fantastic. But, yeah, I think a lot of what you're talking about with this kind of disillusionment with friend request. I have 1000 friends. Well, how many of those 1000 friends are going to show up at your funeral or when you break your leg and bring you food so that you don't have to get up and be on your feet to cook like that's the difference for me, that if it's solely a virtual connection that is the design is to have a lot of people's thing. I can say I have 1000 friends. That's way different than having those quality relationships.
Dr. Daniel Crosby 24:33
Yeah, I think, I think the good doctor is making a great point there. I think for certain populations, there's some real good that comes from it, because it's made once isolated people. It's made it for once isolated types of folks easier to find their people, right? So I do think there's some value in that, and I've met a lot of great people on social media, to include the two of you, but I think the I think. Think the next step is you have to take it offline, because there's, there's a couple of real dangers with social media. I think this is almost like a meta commentary on life, but I think some of the I think some of the worst, most damaging things in our lives come disguised as half truths. And I think that is true of social media, because it has the look and feel of friendship with none of the substance, right? It has sort of, like the illusion of connection without getting the soup when you're sick, like, like Dr Luther is talking about, and so I feel like it's, it's empty calories, like it's a counterfeit for connection, unless you take it offline IRL and deepen those relationships. And then the second thing that's sort of well trodden and well discussed by people like John height is that social media is a highlight reel of other people's lives that we then compare to the brutal, inane, boring, play by play, moment by moment, of our own experience. So we're seeing only the best of what's going on with other people, and you know, are acutely aware of all of our of all of our shortcomings, and it it becomes a bit of a fun house mirror for what life is like, and we get a distorted vision of how other people are living. And I think it's really damaging for people, especially young people, who don't have the sense to kind of make sense of the fun house mirror, but even for old folks like the three of us, I think it's problematic.
Dr. Sonya Lutter 26:52
Do you know that Gallup says that six hours of social connection per day is the most ideal? If it's less than that, it's damaging to your happiness. If it's more than six hours, it actually has a decreasing contribution to your happiness, which I think is really interesting to think about. And I know college students who are on social media six hours a day. So it's definitely possible to invest six hours a day into relationships virtually. But still, I think it's different to what you're saying of is this a quick snap back and forth that they're doing, or is this an engaged conversation that last more than a few seconds?
Wes Brown 27:38
Yeah, that's interesting. All right, so
Dr. Sonya Lutter 27:40
we were both therapists at one point in time. For the record, neither one of us are practicing therapists, so be careful what sort of information you take from us. Both of us in very unique places at one point along the way. So you at an Eating Disorder Center, me at a juvenile justice center, ie jail for kids. And there's so many really fantastic messages to take from those experiences, for sure. And one of the things that I saw you post about recently on your experiences at the eating facility eating disorder facility was on the role of, I think it was specifically social media in promoting distorted images of reality, and I think you were talking about eating disorders, but this 100% plays into financial issues and how easy it is for people to show a different financial wellness level than what might be reality. So I'm kind of wondering if you've thought about it in that way as well, and your general thoughts on these distorted images. Yeah.
Dr. Daniel Crosby 28:55
So a quick, quick background. I worked at this inpatient eating disorder treatment center for primarily young women, and I was surprised that the first thing that they did was not therapy or nutritional counseling or anything like that. It was, it was teaching them to be informed consumers of the media that they're exposed to every day, and informed consumers of sort of the way that female beauty standards have been tortured and airbrushed and warped, and, you know, bound through, you know, over the years and made them very unrealistic. And I think that's an empowering thing. And I think we as investors have to do the same thing. Like my, my favorite anecdote about this when my last book came out, right the behavioral investor. When that came out, I was asked to be a guest on a prominent cable financial news program. And when you do this like you have a little earpiece and you can hear the producer in your ear as well as what's going on on TV to set the. Stage a bit. I was wearing tortoise shell glasses, a tweed jacket and a motoc, right? Like, really going for it, like, really owning the shrink thing, and then I've got my crazy hair, and so the producer is counting me down, like I'm about to be live, and she's like, 5432, you know, you're about to go live. And she says, right before she gets to two, one, she says, we're about to go live, give me something good. We're making news here, or something like that. You know, like, Give me something good. Be exciting. And if you think about it's a fascinating look at how the sausage gets made. Because the appropriate thing to say there would be, please remain factual and temperate and scientific in you know, the advice that you give my esteemed listeners, please give us evidence based investing advice with widespread application. But that was not the admonition to me. The admonition to me was like, jazz it up. Nerd like, you know, you know, I think she thought I looked a little stuffy, fair enough, like, you know. She thought I looked a little stuffy, and she wanted me to jazz it up. And I think in an election year, it's especially important for investors to internalize this message that it's important that we understand incentives right the people over at you know Cosmo Vogue Maxim, whatever, they're not out there for the mental well being of young women, right? They're out there to sell magazines. And in the same way, the people who are talking about your money online with the ostensible, you know, aim of helping you make more money, are really selling, you know, advertising space. They understand that bad news sells, they understand that activity sells, they understand that certainty sells, and you should expect them to act that way. So I think being an informed consumer of media in a time where there's so much bad financial advice, political division is at an all time high in this country. I think a lot of it is because people are uncritically lapping up the things that they see on TV and in magazines, and it's really a problem, and it's really empowering to take the other side of that. So
Dr. Sonya Lutter 32:36
how do we become better consumers of all of those things. Well, okay,
Dr. Daniel Crosby 32:41
you got a couple things. First of all, you gotta, you gotta question the melodrama, right? If you turn on, you know, arguably the most popular financial news program, you've got someone screaming, hitting buttons, throwing plush toys smoke coming out of their ears. Like, what is it about emotion? Like, is that emotion a vehicle to give me good advice, or is that bombast to sell more commercials, right? So you gotta, you gotta question the the motives, right? I think you have to question the background. There are people like the only time I watch the news blissfully is in the gym in the morning. That's the only time I would ever like run into it on purpose, so to speak. But it's like they'll have DJs and wrestlers and people giving their opinion about the finance, about the about Bitcoin, or about who the next President will be. What do I care about what a wrestler says about who the next President will be? Right? I think you have to question the credentials of the person talking about it. So I think questioning the means by which the message gets delivered and the messenger itself is important. And, you know, I go back to Philip tetlocks research on forecasting, right? He found that the more famous a forecaster, the worse their forecast tended to be. Because the way you get famous is by making a once in a generation Black Swan forecast, right? So even, like how well known someone is a sort of a contra indicator for taking their advice, which is 180 degrees to how the average person experiences that they go, oh, you know, I saw this guy on The Big Short. What does he have to say and not? Wow, he's still banging the same drum he was in 2008 which is probably the more appropriate response.
Dr. Sonya Lutter 34:46
There's similar research about morning star that the five star funds tend to underperform Three and Four Star Funds.
Wes Brown 34:54
It is interesting. I mean, I think again, just weaving social media back in, I guess I. I could see that as being both an exacerbating factor, but also helpful. I think sometimes, when we talk to clients about things, I'm a little caught off guard at times about some of the things they believe that they heard and they believe they just embrace and because, in my mind, the right information is there, and if anything, at any point in history, it's probably more widely available now than it's ever been. What are the so, I mean, is it? Is it emotion? I mean, arguably, I would imagine if you were to go online and read, let's say you read 10 articles, and some percentage of them are going to be factual and worth following, and some percentage, probably five times as many, are going to be on whatever the ratio is. You guys would know that data, but are going to be inflammatory and sensationalized and are going to give advice that isn't to your benefit. But what causes is it? It's really just emotion. Is that? Is it that fear or greed reaction is something that drives them to just go, Oh, this one feels right. This one doesn't to reject the truth a lot of the time, maybe not all the time. So
Dr. Daniel Crosby 36:11
one of the hardest things, I think, for us to grasp is that facts have almost nothing to do with behavior. Like, we think, you know, we think this about financial literacy and financial education a lot like, Well, hey, if everyone just took a class in high school, well, then we would be all squared away, because everyone would know how to balance a budget, right? You know when, when I'm coming home from a trip and I'm tired and I miss my family, and I can't wait to be home and I get a Cinnabon instead of a salad, right? I'm never like, this is better for me, you know? Yeah, it's not a, it's not a lack of information, right? It's a, it's a lack of willpower or or there's like an emotional piece to it. So I think emotion is, is a big piece to it. The other time, other way to think about it is the the palatability of a question, right? So we know all about Super palatable food. Some food is tastier than other food, right? Doritos are tastier than broccoli because they're super palatable, right? Like we have engineered them, we have weaponized them to be delicious, and it worked, and information has been weaponized to become super palatable as well. A lot of truth is very tedious and boring, right? A lot of truisms about putting together your financial life would take a while to explain. Would take a level of financial literacy to understand. But like XYZ, stock is going to the moon, is very easy to understand or run. Sell everything. The bad guy or the bad girl is going to be president next, and you don't like them, and the world does, you know the sky is falling. That's super palatable information. So one of the things that we do is called answering an easier question, and and, because it's, you know, because it's an election year, let's think about choosing who you're going to vote for. Like, choosing who you're going to vote for should be a remarkably complicated process, right? Like, what's their temperament, like, what's their track record? Like, what's their foreign policy, domestic policy, fiscal policy, like, if you really wanted to cast a good vote for president, it would take a minute to sort out who you were going to vote for and really, like, map everything out on a spreadsheet. But most people answer an easier question, which is, you know, first and foremost, are they from my tribe, right? Do they look like me? Do they have the same letter? Do they have the D or R that that I sort of identify with? You know, they'll answer an easier question, like, Would I like to have a beer with that person and not how are these, you know, 17 different facets of their of their decision making style. So I think that is really there's many, many things. Emotion is a big piece of it, but I think the palatability of truth has a great deal to do with it, and just sometimes the way things are marketed to us are to get us to act regardless of the advisability of the thing in question.
Dr. Sonya Lutter 39:45
100% agree with all of that. And then taking it just a little step further is confirmation bias. So I've already identified my emotional attachment to whatever the thing is. And if you're going to tell me something that. Doesn't align with that. There's no way I'm listening to you. I will find five other things that prove my point, and that must be the truth. Yeah,
Dr. Daniel Crosby 40:09
because I mean confirmation bias, right? Confirmation bias works because doing otherwise requires us to look at ourselves and go, Oh, I was wrong about this, or maybe the things that I've been doing aren't right. That requires something of us. We're very tired, right? I mean, we are. We have kids and jobs, and we don't want to kind of re examine the dusty corners of our lives. It's better to keep those blinders on. Vote for who we've always voted for, do with our money what we've always done and not have to examine life, which is exhausting,
Dr. Sonya Lutter 40:45
absolutely.
Wes Brown 40:46
Yeah, I get it. I mean, it feels right. I feel like I've lived that for sure. And I definitely it's not the Cinnabon it's, it's Twizzlers, long rides, you know, I like I'm determined to find something healthy, and eventually my willpower gives out
Dr. Daniel Crosby 41:03
Twizzlers. At least Go Red Vines. My guy like, at least, at least get some of the good Australian liquorice or something.
41:11
Yeah, there you go. Yeah, yeah.
Dr. Sonya Lutter 41:12
This has been delightful. Daniel, as we come to the end, we ask two questions of all of our listeners, and I'm so intrigued by the first one, because we like to know what book you're reading, and I'm not going to let you cheat and say your own book, so you're gonna have to venture out a little bit and tell us a different book that you're reading. Okay, so
Dr. Daniel Crosby 41:31
I'm reading, I'm reading two books right now. One is called Arsenic and Adobo. It is very dumb. It is a mental cupcake. I was a missionary in the Philippines. I speak Filipino. I love Filipino food, and so this is a murder mystery with sort of a golden thread of Filipino cuisine throughout the thing. No one else would like it, but me, it is a mental cupcake, but I love it, and then I am reading the Oxford Handbook of Meaning. Is my opposite of that compilation of scholarly works on things like neuroscience and purpose in life, psychology and purpose in life, theism and purpose in life. So that's my Twizzlers and my broccoli that I'm reading right now.
Dr. Sonya Lutter 42:27
That one has legitimately been on my reading list. So you're gonna have to tell me read it or not. The second one, not the first one. About
Dr. Daniel Crosby 42:33
a quarter of the articles are very good. About three quarters are pretty dry,
Dr. Sonya Lutter 42:38
not today, maybe in the future. I'm
Wes Brown 42:40
curious how you pair them together. You do like, 10 pages of each, yeah, do you like
Dr. Daniel Crosby 42:45
just do a bit of each? Yeah, One's, one's war and peace. One's the Jersey Shore. You just gotta, you know, gotta get a little bit of each.
Wes Brown 42:55
There you go. Well, our last, last question we like to ask everybody is, how you, you know, how do you build moments of authenticity in your day?
Dr. Daniel Crosby 43:02
So in my, in my reading on on meaning and purpose and authenticity of this is like what I'm what I'm thinking about right now. I have a shorthand for what it takes to live a meaningful life, and I call it believing, belonging and becoming right. These are sort of my three, three legged stool of a good life. Believing is your faith, your personal philosophy, your belief system. The research is really clear that the people who have the best lives have some sort of moral code or another, right? So I think trying to do something in your day that feeds that part of you or reminds you of your moral code as I think one aspect of authentic living, belonging is the relational piece, right? Spending time with my family is my greatest joy in life. They're just like the coolest people to me, and I feel very lucky. And they also call you on your nonsense, right? They won't let you get away with anything. So that keeps you authentic and then becoming is this vision of who you want to be, how you want to grow. And that's the third piece that I that I'm always kind of thinking about and and writing about and and workshopping and journaling is like, Who do I want to be? How do I want to grow? How do I want to be better tomorrow than I am today? So those are my three things, like try and have that, that that faith, that family and that future orientation. If you got those three things, I think you're on your way.
Dr. Sonya Lutter 44:35
Of course, you nailed that one. Dr Crosby,
44:39
fantastic.
Dr. Sonya Lutter 44:41
Thank you so much. Get out there and read your book. I'm excited. And then we will all be able to recite the 50 reflections on money and meaning.
Dr. Daniel Crosby 44:50
That's right, thanks for having me, guys. Of course, you.