Stuff About Money: Episode 70: Mental Frameworks for Making Better Financial Decisions

In this episode of the "Stuff About Money" podcast, host Erik Garcia, CFP®, BFA™, ChFC®, sits down with Ryan Hanley, a consultant to an AI marketing company, successful podcaster, and executive coach. Ryan's podcast, "The Ryan Hanley Show," is a top 20 business podcast on Apple and ranks in the top 145 of all Apple podcasts. They discuss the key points from a recent keynote Ryan delivered, focusing on the importance of using mental frameworks to make better financial decisions. Ryan shares how these frameworks help us navigate our inherent biases and beliefs, leading to more sound financial choices. Erik and Ryan cover several valuable concepts, including the Pareto Principle, the metaphor of buffalo running towards a storm, and their shared views on goal setting. They emphasize that goals are not about winning once, but about winning repeatedly and staying in the game. Long-term financial success is achieved through a series of small, wise decisions that compound over time, which is why having frameworks to guide these decisions is crucial. Tune in to discover practical insights and strategies to enhance your financial decision-making using effective mental frameworks. Episode Highlights: Ryan shares his journey in the insurance industry and current roles in consulting, podcasting, and coaching. (3:34) Ryan discusses optimizing for resilience over mere growth, discussing how the right type of growth can contribute to long-term stability. (6:00) Erik and Ryan discuss the influence of James Clear's book, "Atomic Habits," on their approach to personal and professional growth. (12:00) Erik shares insights on how the principle of compounding interest can apply to both financial investments and personal success. (25:24) Ryan discusses his "Finish Formula" for making significant decisions, which considers preparation, pace, time, and distractions to calculate potential upside. (32:24) Ryan discusses the importance of facing challenges head-on, likening it to buffaloes running into a storm to get through it faster. (36:02) Ryan highlights how the fear of losing status, rather than failure itself, can be a significant distraction and how awareness of this can improve decision-making. (40:00) Ryan explains how the 80/20 rule can be applied to various aspects of life and business, including financial decisions and managing personal expenses. (51:11) Key Quotes: “I think we need to optimize for resilience. And what I mean by that is sometimes growth is the best path to resilience in our business. It all depends on what season we're in, what our goals are, what we want our life to look like.” - Ryan Hanley “For me, it's a core foundational aspect of human connectivity is being present. You can't connect with someone unless they believe they're, you're there with them in that moment.” - Ryan Hanley “I call it the finish formula and this is what I created for myself to make big decisions. This isn't something that you would use for every decision in your life. It's just not necessary. However, for bigger decisions in your life, I created this formula called the finish formula.” - Ryan Hanley Resources Mentioned: Ryan Hanley The Ryan Hanley Show Erik Garcia, CFP®, BFA Xavier Angel, CFP®, ChFC, CLTC Plan Wisely Wealth Advisors