In more than 20 years working in financial services, I’ve seen one simple truth play out again and again: Emotions and money don’t mix.
Why? Because emotions often drive us to make the worst possible decisions with our money, leading us to buy high and sell low. The last two years on Wall Street further illustrate the kind of wreckage that can occur as the heat of the moment drives investors to become their own worst enemy.
Emotional decisions can be toxic for entrepreneurs as well. Despite calls to "go with your gut," business decisions based on emotion—especially when you are angry or competing for survival—can lead to disaster.
So, before investing all of your resources on a hunch or firing a promising employee for making a costly mistake, cool your temper or curb your enthusiasm. If necessary, sleep on it and remember the wisdom of an old Russian proverb: Trust, but verify. Review the plan you have and weigh the consequences of your decision before you act. The extra time might mean the difference between a smart strategic move and a disastrous mistake that could ruin your business.
President and CEO
Loring Ward Group
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