Episode 116 – Behavioural Finance with Greg Davies

The Financial Wellbeing Podcast

Episode 116 – Behavioural Finance with Greg Davies

In today’s show, we have another fascinating conversation with Greg Davies, as he comes back to chat with us for a third time! Greg dives into the concept of behavioural vulnerabilities and the importance of anxiety-reducing returns when making money choices. He also shares insights on how we can identify and adapt to our behavioural traits to make better financial decisions. If you’ve enjoyed Greg’s previous appearances on the podcast, you won’t want to miss this insightful follow-up conversation. Let’s get started!

Welcomes & Introductions

Want to know more about Chris Budd’s The Financial Wellbeing Pulse? Take a look here
Fancy a chat with Tom Morris and the team at Ovation? Contact details here

What’s on Today’s Podcast?

We have another chat with Greg Davies, head of Behavioural Innovation at Oxford Risk – exploring how our behaviours effect our financial relationships.

Catch up on previous conversations with Greg Davies in Episode 25 – Behavioural Economics and Episode 38 – Keeping it Fuzzy

Tight Ass Tommo

Chris’s tip – saving up for a big ticket item? Us mental accounting to help – set up a new account and give it a specific name related to what you are saving for. You are more likely to reach that savings goal!

#TATTOTW – As electric vehicles become more popular, Tom shares his tips for keeping costs down, including having a smart meter, going onto dual/evening tariffs and consideration around when you charge your car.

Interview with Greg Davies

What has Greg been up to in between interviews on The Financial Wellbeing Podcast?

Working in applied behavioural finances – building ideas into technology to help people make better financial decisions.

How do we know what ‘better’ is?

We should be chasing anxiety reducing returns

What do we mean by Financial Personality?

We are bad at assessing our reaction to stressful situations when we are not in stressful situations!

Attitudes to risk

Behavioural vulnerability

There is no right place to be, you are where you are

A few examples of behavioural vulnerabilities;

• Financial – I don’t have enough
• Knowledge Based – I don’t know what I am doing
• Health – cognitive issues
• Impulsive –
• Over confidence – doing the wrong thing in the moment
• Under confidence – leads to loss of returns over time

Can all be detrimental to making better money decisions

Misalignment of values

How do we identify our behavioural vulnerabilities?

How do I get the emotional comfort I need at the lowest cost way to my financial returns?

How to use the knowledge around your behavioural vulnerability?

Changing our environment to suit our behavioural vulnerability

Conclusions from the Guys

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Greg Davies founded the first behavioural finance team at Barclays Bank in 2006 and is a specialist in behavioural finance and decision science. He now works at Oxford Risk building tools to improve financial decisions.

Want to know more – connect with Greg on LinkedIn