The Psychology of Everyday Life: Motivation and the Search For Happiness

The Psychology of Money

How important are our emotions in our decisions about money?

Although we may think we make financial decisions through thoughtful analysis, in truth it is our emotions that do the lion’s share of the work. Brain imaging studies show that the emotional parts of our brain are extremely active when we make decisions about money. In fact, the emotional brain is frequently more active than the parts of our brain involved with thought. Therefore, in order to understand the psychology of money, we have to understand how emotion affects our decisions about money.


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