Investors are routinely warned about allowing their emotions to influence their decisions. However, they are not often cautioned that their preconceptions and biases may color their financial choices.
In a battle between the facts & biases, our biases may win, especially when we don’t realize we have them. If we acknowledge this tendency, we may be able to avoid making unexamined choices when it comes to personal finance. It may actually "pay" to recognize blind spots and biases with investing.
Here are some common examples of bias creeping into our financial lives.