As investors, we have to contend not only with the erratic and unpredictable nature of markets but also the erratic and irrational way in which we think and behave.  A lack of knowledge, combined with a number of illusions and biases can lead to errors in making decisions that can turn out to be very costly.  Some of the common behavioural traps – and how to avoid them – are set out below:

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We tend to regard wealth as financial assets, large houses, and nice cars accumulated through a life of hard work.  Yet that is to view wealth in narrow terms; on the very day we are born we are wealthy in terms of our human capital, or in other words, the present value of all the future earnings that we will generate over our working lives.  This needs to be reflected in how we invest during the accumulation phase of investing.

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The Chancellor has delivered his first and last Spring Budget. From now on, Budgets will be delivered in the autumn, with the first one taking place in autumn 2017. The Office for Budget Responsibility will produce a spring forecast from spring 2018 and the government will make a Spring Statement responding to that forecast. The government will retain the option to make changes to fiscal policy at the Spring Statement if the economic circumstances require it.

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The price of BP is the price of BP.

Every day millions of shares are bought and millions of shares are sold.

All of the sellers think they are getting a good price and all of the buyers think they are getting a good price.

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People who make bad money and investment decisions can often rationalise them. We’ve put together some thoughts on some of the most common excuses but there are plenty more.

These arguments are often elaborate short-term excuses that we use to justify behaviour that runs counter to our own long-term interests.

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There has been a huge amount of change in pension rules over the last few years, so why is this happening and what does it mean?

Final salary pensions are dead. Politicians can argue about whose fault that is but they are finished. If you’re in one, count yourself very lucky but expect further watering down of your benefits. They have virtually all gone in the private sector and they will eventually be phased out in the public sector. That’s not the official line, of course, but there is an inevitability about this.

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Think about how much time you spend planning Christmas or organising your summer holiday.

Then, consider how long you spend planning your family’s finances. Is there a mismatch here? For most people there probably is.

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The best way to contact us is to call on 0208 240 6511. A conversation with one of our Financial Life Planners will help you and us decide how our services are likely to be able to help you.