So the next time you walk into a financial planner's office, do not
be surprised if you find your money guru on a yoga mat, in a
Financial planner Cary Carbonaro is one of them.
"Yoga centers you and forces you to slow down, like a total reset of
your buttons," said the New York- and Florida-based author of "The
Money Queen's Guide," and a yoga practitioner. "So even if my
clients are freaking out, they have to go through me first, and I
won't let them make bad financial decisions."
Carbonaro is part of a growing movement in the United States of yoga
practitioners, now numbering some 36.7 million Americans, according
to a new study by Yoga Journal and Yoga Alliance, up from 20.4
million four years ago.
Planner Leon LaBrecque of Troy, Michigan, took up yoga around 15
years ago as part of his martial-arts training, but quickly found
that it had advantages in the workplace. LaBrecque practices his
yoga breathing when the market gets agitated, and says it helps him
make better decisions.
"It gives me grounding in my day-to-day practice, helps me focus on
the big picture, and takes away all the little details," he said.
A MOMENT OF MINDFULNESS
Talk of body poses and proper breathing might seem, well, a bit
touchy-feely when financial planning is such a serious and
quantitative field. But it makes sense to Hedy Kober, an assistant
psychology professor at Yale University, who runs its Clinical and
Affective Neuroscience Laboratory.
"From many studies we know that mindfulness improves our attention
to detail and ability to concentrate," she said. "Research also
shows that if you delay your decision-making by even just a few
seconds, those decisions tend to be much more accurate. So
mindfulness gives you the ability to pause and think things through
Mindfulness also roots out many of our usual thinking biases, she
said, which should lead to better financial decision-making. One of
those brain hiccups is the "negativity bias," in which negative
events tend to impact our thinking much more than positive ones.
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It also helps prevent the "sunk cost bias," which holds that if we
have already put lots of money into something, we are unlikely to
sell, even if the investment is a turkey.
A moment of mindfulness can save you years of retirement savings,
too. Brad Barber and Terrance Odean, graduate college professors in
California, found people are generally lousy at investing because of
things like frequent trading and media influence.
In comparison, the more relaxed contingent of buy-and-hold investors
beat frequent traders by 7 percent a year.
IT TAKES TWO
But no matter how enlightened and relaxed your financial planner is,
it is still your money. If you are the one who is stressed out and
demanding action, an adviser might not be able to help.
That is why financial planner Bill Harris of Duxbury, Massachusetts,
now starts many planning sessions by doing breathing exercises with
"It slows them down, and gets them in a different mindset," said
Harris, who took up yoga a couple of years ago at the advice of his
wife, who is also a planner. "They really appreciate it."
Michigan planner LaBrecque actually prefers clients who are into
yoga like himself. "When there are two yogis in a room, you
automatically get into it together," he said. "Yoga clients are
easier to deal with - there is a mellowness about them."
(Editing by Beth Pinsker and Matthew Lewis)
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