Economy

Reading Time: 3 minutes

My family and I have been watching Beast Games on Amazon Prime, and while I won’t say I completely endorse the show, I will say—it has been a fascinating look at human psychology and decision-making. The game started with 1,000 contestants, all competing for a massive $5 million prize, and it has been filled with twists and turns that test how people react under pressure.

One of the latest challenges was a perfect example of behavioral psychology in action. The final 10 contestants were asked to elect a leader, who would then choose who received keys to house #2, then house #3, and so on, until the last contestant was assigned house #10. This order was critical because, one by one, contestants secretly emerged—starting with the player in house #1—and chose how much they wanted to take from a $1 million pool. The only information given to later contestants was how much money remained.

Contestant #1 took an equitable approach, withdrawing $100,000 (a fair 1/10th share) and returning to their house. However, things quickly escalated:

• Contestant #2 took $223,000
• Contestant #3 took $650,000

That left only $27,000 for the remaining seven contestants, triggering immediate frustration and resentment once the game was revealed. You could feel the tension when the players gathered afterward—many were furious at the greed of contestant #3.

The Math Behind Rational Decision-Making

If the contestants were purely logical, they would have approached the decision using expected value.

• At this stage of the competition, each player had a 1 in 10 chance of winning $5 million.
• That means their expected return was $500,000 (10% chance of $5 million, 90% chance of $0).
• If they were thinking purely in terms of maximizing return, any guaranteed offer above $500,000 should have been accepted without hesitation.

Yet, human nature is rarely rational when money is involved. Instead of treating the decision as a math problem, emotions took over—fear of missing out, greed for more, and social pressure to “play fair.”

Why We Act Irrationally with Money

The same biases that played out in Beast Games show up in real-world financial decisions all the time:

• Loss Aversion: We fear losing money more than we enjoy gaining it. Some contestants were so afraid of missing out on a higher amount that they didn’t secure a guaranteed win. This is similar to how investors often hold onto losing stocks too long, hoping they will recover.
• Social Pressure: The expectation was that everyone should split the money evenly, creating groupthink. In investing, we see this when people follow market trends rather than making independent, strategic decisions.
• Greed vs. Fear: One contestant saw an opportunity to grab the lion’s share, while others hesitated out of fear of being perceived as selfish. Investors often face a similar dilemma—should they take profits when the market is high or stay in, hoping for even greater gains?

What This Has to Do with Intelligent Investing

At Intelligent Investing, we see these behavioral patterns every day in financial markets. Just like the contestants in Beast Games, investors often let emotions override logic. That’s why we built our boutique wealth management firm around helping high-net-worth individuals make better financial decisions by removing emotion from the equation and focusing on long-term, rational strategies.

• We help clients avoid reacting emotionally to market swings.
• We create guardrails to prevent fear and greed from leading to poor decisions.
• We act as an accountability partner, ensuring financial choices are made based on sound principles rather than short-term impulses.

Final Thoughts

At the end of the day, Beast Games is just that—a game. But in real life, the stakes are much higher. The financial decisions we make today impact our future wealth, our families, and our ability to live the life we want.

If you’ve ever felt the pull of fear or greed when making financial decisions, you’re not alone. Investing is more than just numbers—it’s about behavior. That’s why at Intelligent Investing, we act as an accountability partner, helping clients keep their emotions in check, stay disciplined, and make rational financial choices that align with their long-term goals.

If you’re interested in having a trusted partner in the “game of life,” we’d be honored to help. Click here to schedule a coffee or complimentary call to discuss how we can help you minimize financial stress and maximize your life.

Disclosure: This blog may reflect the perspectives and research of Intelligent Investing and, where applicable, incorporates insights from guest interviews or expert opinions. Any external views or opinions shared do not necessarily reflect the stance of Intelligent Investing. We may also utilize tools such as ChatGPT to enhance readability, grammar, and flow, while all core ideas remain proprietary to our firm.

Please note that Intelligent Investing does not provide specific tax or legal advice. All investments carry risks, including the potential loss of principal, and past performance is not indicative of future results. Any specific securities, sectors, or investment strategies mentioned are for informational purposes only and should not be considered a recommendation. We encourage readers to consult with Intelligent Investing for advice tailored to their unique financial situation. Unauthorized reproduction or distribution of this content is prohibited without proper credit to Intelligent Investing.

Reading Time: 2 minutes

In Super Bowl XLIX, with just 26 seconds remaining, the Seattle Seahawks were one yard away from a potential game-winning touchdown. Instead of handing the ball to star running back Marshawn Lynch, Coach Pete Carroll opted for a pass play. The result was a game-sealing interception by Malcolm Butler of the New England Patriots. The next day’s headlines were unforgiving, labeling it the “worst call in Super Bowl history.”

While the play’s outcome was unfavorable, statistical analysis suggests the decision to pass was defensible. Out of 66 similar plays that season, none had resulted in an interception. This scenario exemplifies “outcome bias,” where decisions are judged solely on their results rather than the rationale behind them.

Applying Lessons to Investing

Investors often fall into the same trap. When markets decline or investments underperform, it’s tempting to label the decisions as poor in hindsight. This hindsight bias can lead to emotional reactions, such as withdrawing from markets during downturns or chasing trends out of fear of missing out.

At Intelligent Investing, we emphasize the importance of a sound decision-making process over short-term outcomes. This includes maintaining a diversified portfolio, automating contributions, and staying disciplined during market volatility. While markets are inherently unpredictable, adhering to a well-thought-out strategy can help mitigate the impact of unforeseen events.

Partnering for Long-Term Success

Our role as wealth managers extends beyond portfolio construction; we serve as accountability partners, helping clients navigate the emotional complexities of investing. By focusing on controllable factors and understanding the distinction between luck and skill, we guide clients toward long-term financial success.

If you’ve ever second-guessed your financial decisions, we’re here to help. At Intelligent Investing, we collaborate with you to develop a resilient strategy designed for long-term peace of mind, regardless of market headlines.

Sign up for our monthly newsletter, where we share timely and timeless truths to enrich your daily life and help you achieve your financial goals.

Disclosure: This blog may reflect the perspectives and research of Intelligent Investing and, where applicable, incorporates insights from guest interviews or expert opinions. Any external views or opinions shared do not necessarily reflect the stance of Intelligent Investing. We may also utilize tools such as ChatGPT to enhance readability, grammar, and flow, while all core ideas remain proprietary to our firm.

Please note that Intelligent Investing does not provide specific tax or legal advice. All investments carry risks, including the potential loss of principal, and past performance is not indicative of future results. Any specific securities, sectors, or investment strategies mentioned are for informational purposes only and should not be considered a recommendation. We encourage readers to consult with Intelligent Investing for advice tailored to their unique financial situation. Unauthorized reproduction or distribution of this content is prohibited without proper credit to Intelligent Investing.

Reading Time: 3 minutes

Did you watch the Super Bowl this year? As a Pennsylvania native, I know many of my friends were thrilled about the Eagles’ victory. But beyond the game itself, one unexpected thing grabbed viewers’ attention—the new score bug graphic introduced by Fox.

For those unfamiliar, the score bug is the digital display that shows the teams, scores, and key game stats throughout a broadcast. This year’s redesign featured extra-large fonts to improve readability on smaller screens like phones. While some praised its simplicity, others were less enthusiastic, even likening it to 1980s MTV graphics.

Change Can Be Uncomfortable

As Michael Middlehurst-Schwartz from USA Today put it, “If you’re debuting a new score bug at the Super Bowl, you better be confident it will be met with approval.” The strong reactions online proved that change—especially in something as familiar as a scoreboard—can spark debate.

This reaction is a perfect analogy for how we approach financial tools and technology. When the first iPhone debuted, critics dismissed it, arguing that a touchscreen wouldn’t be practical. Fast forward a few years, and we can’t imagine life without it. New tools take time to get used to, but once they prove their value, they become indispensable.

Simplifying Financial Complexity

That’s exactly the experience our clients have had with Intelligrations—our internally designed financial software. From the moment we introduced it, clients embraced it for its simplicity, clarity, and ease of use.

• Clear, integrated reports that consolidate financial data
• No distractions, just the key numbers you need
• Real-time insights on net worth, investment performance, and tax strategies

Unlike the controversial score bug, Intelligrations features no unnecessary distractions—just a straightforward view of your financial health, all in real-time.

A Winning Strategy for Your Financial Future

Much like how the Super Bowl’s new scoreboard design will likely evolve and grow on viewers, Intelligrations continues to improve based on client feedback. In fact, financial advisors nationwide are reaching out, wanting to offer it to their own clients. It’s proof that clarity and simplicity always win in the long run.

If you’re tired of financial chaos and want a tool that gives you a clear view of your wealth, let’s connect. We’d love to offer you a complimentary call or coffee chat to discuss how Intelligrations can help you take control of your financial future.

Because just like in football, having the best possible view makes all the difference.

Sign up for our monthly newsletter, where we share timely and timeless truths to enrich your daily life and help you achieve your financial goals.

Disclosure: This blog may reflect the perspectives and research of Intelligent Investing and, where applicable, incorporates insights from guest interviews or expert opinions. Any external views or opinions shared do not necessarily reflect the stance of Intelligent Investing. We may also utilize tools such as ChatGPT to enhance readability, grammar, and flow, while all core ideas remain proprietary to our firm.

Please note that Intelligent Investing does not provide specific tax or legal advice. All investments carry risks, including the potential loss of principal, and past performance is not indicative of future results. Any specific securities, sectors, or investment strategies mentioned are for informational purposes only and should not be considered a recommendation. We encourage readers to consult with Intelligent Investing for advice tailored to their unique financial situation. Unauthorized reproduction or distribution of this content is prohibited without proper credit to Intelligent Investing.

Reading Time: 4 minutes

“A house is made of walls and beams; a home is built with love and dreams.” – Unknown

Over the past year, we have witnessed heartbreaking examples of homes being destroyed. Last fall, Hurricane Helene swept through the Asheville and North Carolina mountains, leaving devastation in its wake. This year, fires in Los Angeles have displaced countless families. These events are sobering reminders of the fragility of physical structures and the emotional toll of such losses.

While it is crucial to empathize with those affected, these tragedies also serve as an opportunity to reflect on how we view our homes in the context of our financial lives. Many Americans mistakenly consider their primary residence an investment, but this perspective warrants reconsideration.

The Definition of an Investment

The CFA Institute defines an investment as “putting money into a project or undertaking with the expectation of earning a profit or income.” Real estate investments, according to the CFA Institute, typically fall into four categories:

1. Private Equity: Direct ownership of property.
2. Publicly Traded Equity: Indirect ownership claims, such as real estate investment trusts (REITs).
3. Private Debt: Direct mortgage lending.
4. Publicly Traded Debt: Securitized mortgages.

A property is considered an investment if it is not your primary residence and is purchased to generate income or profit. This includes residential rental properties, commercial spaces, industrial properties, or even vacant lots.

Your primary residence, however, is not typically purchased with the intent to generate income. While it may appreciate in value over time, this appreciation can be misleading due to the time value of money and other hidden costs.

The Reality of Home Appreciation

Homeownership often feels like a sound financial decision because many people see their homes increase in value from the time of purchase to the time of sale. However, this appreciation is often less impressive when viewed through the lens of financial principles. For example:

• Time Value of Money: If a home’s value doubles over 18 years, the annual growth rate is approximately 4%, as calculated using the Rule of 72.
• The Rule of 72: This rule states that dividing 72 by the annual rate of return gives an estimate of how long it will take for an investment to double. For example, at a 4% annual growth rate, it takes 18 years for a home’s value to double.

This 4% growth is modest compared to historical returns of diversified equity investments, which have averaged around 7-10% annually over the long term.

Hidden Costs of Homeownership

Beyond modest appreciation, homeownership comes with significant costs that can erode any perceived gains:

1. Maintenance: Roof repairs, HVAC replacements, and landscaping are just a few examples of ongoing expenses.
2. Property Taxes: These are often a significant annual expense.
3. Insurance: Necessary but costly, especially in regions prone to natural disasters.
4. Opportunity Costs: Funds tied up in home equity could potentially earn higher returns in other investments.

The Importance of True Diversification

The key to building a resilient financial portfolio is diversification. While owning a home is an essential part of life, relying on it as your primary investment can leave you vulnerable. Natural disasters like those in North Carolina and California are stark reminders of this vulnerability.

Instead, consider spreading your investments across different asset classes and geographic regions:

• Stocks and Bonds: These provide opportunities for growth and income that outpace inflation over time.
• International Investments: Diversifying beyond local and national markets can reduce risk.
• Insurance: Proper insurance coverage is essential to protect against catastrophic losses.

Final Thoughts

While your home may feel like a cornerstone of your financial security, it is important to view it through a realistic lens. Homes often appreciate at a rate that merely keeps pace with inflation, and the associated costs can significantly diminish returns.

At Intelligent Investing, we’re here to serve as your accountability partner in building a diversified and resilient financial future. Let us help you create a strategy that goes beyond your home to achieve true financial peace.

Our prayers go out to those affected by the recent disasters. At Intelligent Investing, we believe strongly in risk mitigation, and this aligns with our passion for minimizing financial stress and maximizing lives. As the new year begins, this is an excellent time to organize your financial “junk drawer” and create a plan for a secure future.

Sign up for our monthly newsletter, where we share timely and timeless truths to enrich your daily life and help you achieve your financial goals.

Disclosure: This blog may reflect the perspectives and research of Intelligent Investing and, where applicable, incorporates insights from guest interviews or expert opinions. Any external views or opinions shared do not necessarily reflect the stance of Intelligent Investing. We may also utilize tools such as ChatGPT to enhance readability, grammar, and flow, while all core ideas remain proprietary to our firm.

Please note that Intelligent Investing does not provide specific tax or legal advice. All investments carry risks, including the potential loss of principal, and past performance is not indicative of future results. Any specific securities, sectors, or investment strategies mentioned are for informational purposes only and should not be considered a recommendation. We encourage readers to consult with Intelligent Investing for advice tailored to their unique financial situation. Unauthorized reproduction or distribution of this content is prohibited without proper credit to Intelligent Investing.

Reading Time: 3 minutes

The holiday season is now over, and for many, we experienced moving around—visiting family, hosting guests, or maybe even moving homes. Our family recently went through a move, and if you’ve ever moved, you know how stressful it can be to have things scattered everywhere. Boxes in the kitchen, boxes in the living room, and who knows where the scissors and box cutters ended up? The frustration is real. But the moment you finally unpack and everything finds its place, a wave of relief washes over you. Order replaces chaos, and stress gives way to calm.

The same can be said for your finances.

The Financial Junk Drawer Problem

We all have that “junk drawer” in our homes—the place where miscellaneous items like batteries, old keys, and random screws accumulate. It’s often disorganized, but it’s easier to just keep adding to it than to clean it out. For many of us, our financial lives end up looking a lot like that junk drawer:

• Multiple accounts spread across different banks or custodians.
• Various investments in money markets, CDs, brokerage accounts, or 401(k)s.
• Paperwork everywhere—some online, some in filing cabinets.

Recently, a client came to us because her financial life had become just like that junk drawer. She had retirement accounts with multiple custodians, scattered investments, and money parked in different places. The complexity of keeping track of everything was causing her unnecessary stress.

Her relief was almost immediate once we helped her consolidate everything into a single, cohesive portfolio. Not only did this make her financial life simpler, but it also allowed us to better manage her investments and understand her complete financial picture. Just like unpacking after a move, this kind of financial organization brings clarity, control, and a sense of calm.

Why Consolidation Matters

1. Reduced Stress: When everything is in one place, there’s no more guessing where your money is or whether you’re overlooking an account.
2. Better Risk Management: A consolidated portfolio allows us to see all your assets and liabilities, so we can help you manage risk more effectively.
3. Simplified Decision-Making: With a clear view of your finances, decisions about investments, withdrawals, or planning for goals become easier.

The Holiday Connection

This time of year is already stressful enough with the hustle and bustle of holiday preparations, gift-giving, and family gatherings. Why let your finances add to that stress?

Just as you might clean out the guest room for visiting relatives or organize the holiday decorations, now is the perfect time to tidy up your financial life. Imagine starting the new year with your finances in order, everything in its place, and the peace of mind that comes with knowing you’re on track.

Helping You Find Financial Calm

At Intelligent Investing, we’re passionate about helping our clients organize their financial “junk drawers.” Our proprietary financial software, Intelligrations®, helps streamline and integrate your finances so you can focus on what truly matters. We aim to:

• Minimize fees (including taxes).
• Unify families through clear financial communication.
• Maximize your time by reducing the complexity of managing multiple accounts.
• Leverage technology to improve investor behavior and decision-making.

If the thought of your scattered finances is weighing on you, consider this season an opportunity to bring calm to the chaos. Just like the joy of finding that box cutter exactly when you need it during a move, the joy of knowing where your money is—and that it’s working for you—can be a game-changer.

Let’s make 2025 a year where your finances are organized, your stress is minimized, and your peace of mind is maximized.

Disclosure: This blog may reflect the perspectives and research of Intelligent Investing and, where applicable, incorporates insights from guest interviews or expert opinions. Any external views or opinions shared do not necessarily reflect the stance of Intelligent Investing. We may also utilize tools such as ChatGPT to enhance readability, grammar, and flow, while all core ideas remain proprietary to our firm.

Please note that Intelligent Investing does not provide specific tax or legal advice. All investments carry risks, including the potential loss of principal, and past performance is not indicative of future results. Any specific securities, sectors, or investment strategies mentioned are for informational purposes only and should not be considered a recommendation. We encourage readers to consult with Intelligent Investing for advice tailored to their unique financial situation. Unauthorized reproduction or distribution of this content is prohibited without proper credit to Intelligent Investing.