It can be difficult to act rationally when your financial future is at stake, especially when unexpected events like COVID-19 upset the markets.
If we were playing a game and were to offer you a choice of a sure win of $50 or, on the toss of a coin, a chance to win $100 or nothing, while the probabilistic outcome (50% probability of $0 plus the 50% probability of $100) you would likely choose the guaranteed $50 according to scientific studies. After all, it’s a sure thing—you win. But let’s say we change the rules in the second round, and we offer you a sure loss of $50 or, on the toss of a coin, the chance to lose $100 or lose nothing at all, again the same -$50 probabilistic outcome. What would you pick?
If you and your partner are among the millions whose finances have been impacted by current events, now is the time to make sure you have a plan in place to allow you to work together through the crisis.
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