Behavioral finance has shown that all people, even financial experts, are prone to making irrational and suboptimal financial decisions. It also explores how people have wants that extend far beyond traditional finances' assumption of wanting the highest return at the lowest risk. We are not perfectly rational economic robots; we are easily driven by many wants and emotions while working with limited time, knowledge, and energy.

This course explores many of the thinking errors and biases exhibited by all people, even the experts. You'll be able to identify the nonfinancial wants that drive the financial decisions of your clients. We'll then identify ways to improve financial decision-making in the contexts of personal financial planning and business financial management.

You'll learn from an author that teaches these concepts to MBA students at a university as well as to business advisors and staff. He is a CPA that's been a CFO of multiple companies. Rob also has a master's degree in personal financial planning and a graduate certificate in financial therapy. He served as program manager for a group of investment advisors.

This course leads you from foundational finance concepts to practical applications in both personal finance and business finance.

Course Key Concepts: Finance, Behavioral Finance, Economics, Personal Financial Planning, Personal Finance, Business Finance, Business Financial Management, Business Management, Business Planning, Pricing.

Note:This course is also available in Text Based format. https://www.illumeo.com/courses/behavioral-finance-introduction-insights-text-based-course

Learning Objectives
  • Recognize common behavioral finance biases and heuristics.
  • Identify ways to reduce thinking errors caused by biases and heuristics.
  • Discover and recall differences between traditional finance and behavioral finance.
  • Identify negative financial impacts of finance biases and heuristics.
Last updated/reviewed: April 30, 2023
20 Reviews (74 ratings)

Reviews

5
Member's Profile
This is an excellent course for someone desiring to make prudent choices in almost every major financial arena in life especially when it comes to investing and retirement. In addition, this lecture does a great job reminding the realities of human nature and what we are naturally proned to subconsciously in our day-to-day financial decision-making tasks.
5
Member's Profile
This was the best CPE class I've taken in a decade. It really taught me how to re-evaluate my thought process on many things, not just investment related. The knowledge received from this class is something I truly believe will provide me with a competitive advantage in my profession and in dealing with people on a day-to-day basis.
5
Anonymous Author
There is a lot of content in this course. Some ideas are only quickly reviewed, however, it is such a good starting place if you want to dive deeper on any of the topics. I know I will be returning to the videos and materials for review in the future.
5
Member's Profile
Fascinating topic delivered in a very effective way. It was a lot of information, and the biases were hard to keep straight, but the course is a good starting point for future CPE courses. the instructor was engaging. Highly recommend.
5
Anonymous Author
Really like this presenter. Nice overview of behavioral finance. Course was a nice foil to all the technical offerings we normally consume - gives a nod to all the unseen human factors that influence financial decision making.
5
Member's Profile
This is the best Behavioral Finance Course I've taken. The instructor was clear, concise, funny and used real world applications. I look forward to taking more of his courses.
5
Member's Profile
Very interesting and useful info! I found the class easy to listen to and enjoy and feel like I really got some different perspective and new information out it.
5
Member's Profile
Very well explained course material; no special previous understanding of finance and accounting matters is needed to learn many valuable ideas from this course.
3
Member's Profile
The pace of the instruction was too fast causing the need for frequent pausing and replaying of the video. This was cumbersome.
5
Anonymous Author
A great course to help understand how people think when it comes to finances and how to overcome certain bad habits/beliefs.
5
Anonymous Author
Awesome course! Very thorough and includes up-to-date research ideas in the field of behavior economics
5
Member's Profile
Liked the slides and how the information was organized. Questions were clear and concise
5
Member's Profile
Very good comprehensive course to help understand client and colleague mindset.
5
Member's Profile
I really appreciated the in-depth look at the types of biases and heuristics.
5
Member's Profile
The class was interesting and broken into bit sized chunks. Would recommend.
5
Anonymous Author
Great course on a good topic that has a lot of real life applications.
5
Anonymous Author
This course presents the information in a cler and concise manner.
5
Anonymous Author
Lots of different ideas and applicable examples. Very broad
5
Anonymous Author
This was a great course. I would definitely recommend it.
5
Anonymous Author
Excellent amount of knowledge for an unusual study area
show all reviews
Prerequisites
Course Complexity: Foundational

No advanced preparation or prerequisites are required for this course.

Education Provider Information
Company: Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact: For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Instructor for this course
  Course Overview CPE
Course Syllabus
INTRODUCTION AND OVERVIEW
  Introduction to Behavioral Finance3:26
The Emergence of Behavioral Finance
  Some Basics on Traditional Economics3:40
  The Emergence of Behavioral Finance10:38
  REVIEW QUESTIONS quiz
How We Think
  How We Think4:52
  Prospect Theory9:30
  Framing10:08
  REVIEW QUESTIONS quiz
Biases and Heuristics
  What are Biases and Heuristics1:58
  Overconfidence6:02
  Confirmation Bias, Hindsight Bias, and Sunk Costs5:54
  Self-Attribution and Excessive Optimism5:03
  The Endowment Effect, Omission Bias, and Status Quo Bias6:18
  Familiarity Bias and In-Group Bias4:16
  REVIEW QUESTIONS quiz
  Mental Accounting4:50
  Fairness8:02
  Anchoring and Adjustment4:34
  Disposition Effect3:12
  Representativeness and Availability Bias9:38
  Emotions, Mood, and Affect6:18
  Market Observations and Anomalies8:50
  REVIEW QUESTIONS quiz
Some Applications
  Personal Financial Decisions - Investor Wants6:50
  Personal Financial Decisions - Behavioral Life-Cycle Planning8:51
  Personal Financial Decisions - Correcting Errors3:58
  Business Financial Decisions - Overview8:10
  Business Financial Decisions - Planning and Projects5:09
  Application: Retirement Planning and Savings8:06
  Application: Pricing5:00
KEY TAKEAWAYS
  Key Takeaways5:48
  REVIEW QUESTIONS quiz
CONTINUOUS PLAY
  Behavioral Finance2:45:21
SUPPORTING MATERIAL
  Slides: Behavioral Finance: Introduction and InsightsPDF
  Behavioral Finance: Introduction and Insights Glossary/IndexPDF
REVIEW AND TEST
 FINAL EXAMexam