Expense Account, Mint
How should we invest in 2013? Notice I said how and not in what. Maybe it’s age. Or maybe it is just more emotional quotient. But I find myself throwing out the old textbook version of advice on money more often. The textbook version says that your life sits in a neat box. You wake up every morning and revisit your financial goals. You have this perfect asset allocation. And each time this changes, you rush to sell the winning class and buy the losing one. Classical financial planning falls into the same trap that classical economics found itself in—of assuming that we are rational economic agents who maximize utility and do not respond out of emotions of fear or greed. Of course, we’re messier in real life. Our money lives are chaotic and we take emotion-driven actions that come back to bite us more often than not.