March Madness and Investing: Why Behavioral Biases Keep Derailing Us

Whether your Final Four picks include Blue Chip mega-caps (Duke, Michigan and Kentucky), or low-cap growth stocks (High Point, Cal Baptist and Prairie View A&M) behavioral biases are on full display when tens of millions of Americans fill out their NCAA men’s basketball tournament brackets.

March Madness is not just a three-week basketball-palooza. It is a classic example of the cognitive biases that derail investors year after year.  Here are four of the most egregious ones:

1. Overconfidence Bias

Ask anyone why they picked a certain team to go deep in the tournament and you will get a confident, well-reasoned answer. They watched three games this season. They read a column about the point guard. Their cousin went to that school. The coach is hot right now. They did well last year.

This is overconfidence bias in its purest form — the tendency to overestimate the accuracy of our predictions based on thin or anecdotal evidence. Behavioral economists have documented this bias extensively. Behavioral psychologist, Daniel Kahneman, described how people consistently overestimate the precision of their forecasts, especially in complex systems with many interacting variables.

Basketball, like markets, is exactly that kind of system. A star player rolls his ankle in warmups. An underdog catches fire from three. A referee misses a call. The outcome is partly skill and partly chaos — and yet tens of millions of people fill out brackets with supreme conviction. Yet no one has ever predicted all 67 games correctly in the same year. In fact, out of 36 million brackets completed on the major online sites in the 2026, NOT ONE bracket remained perfect by  the 44^th game of the 67 game tournament. And there are still four rounds to go.

Investors do the same thing. We read a few earnings reports, catch a segment on financial television, and proceed to make high conviction bets on individual stocks. We forget that we are competing against professionals who do this 12 hours a day with resources and computing power we cannot imagine. The bracket reminds us: confidence and competence are not the same thing.

For many years, Warren Buffett offered $1 billion to anyone who could pick a perfect NCAA bracket and never once paid up. Now Kalshi, the prediction market site is made the same $1 billion offer. They already know they won’t have to pay up in 2026.

2. Recency Bias: Why Last Year's Champion Gets Too Much Love

In bracket psychology, recent events loom far larger than a full body of evidence would justify. The defending champion University of Florida Gators were a No.1 seed in this year’s tournament and a heavy favorite to make the Final Four. Instead, they got knocked out by No.9 seed, University of Iowa in only the second round. University of Nebraska started the season 20-0 and then dropped seven of their last 13 games heading into the post-season. They fell to a No.4 seed and millions of bracketeers overlooked them as a contender. Yet here are the Huskers in the Sweet 16 having just knocked off Vanderbilt, champions of the highly competitive Southeastern Conference.

Recency bias is equally destructive in investing. When markets are rising, investors pile in, assuming the good times will last indefinitely. When they correct, panic selling takes over. We let the last six months of data override twenty years of historical context.

The data on this is sobering. Dalbar's annual Quantitative Analysis of Investor Behavior consistently shows that average investors dramatically underperform the indices they invest in — not because the funds are bad, but because investors buy high and sell low, chasing recent performance. They are filling out their financial brackets based on last week's box scores.

3. Confirmation Bias: Rooting for Your Pick to Be Right

Once you have committed to a bracket pick, something strange happens. You start finding evidence that supports it everywhere. TV analyst Charles Barkley calls your team a “sleeper to watch” and it feels like vindication. But when pundit Seth Greenberg questions them, you instantly dismiss his take on your team, even if his argument is stronger. You are no longer evaluating information objectively — you are prosecuting a case for your predetermined conclusion.

Confirmation bias is one of the most dangerous land mines in investing. Once we own a stock, we unconsciously filter news through the lens of ownership. Good earnings confirm our genius. Bad news gets rationalized as temporary. We stop asking "should I own this?" and start asking "why should I continue to own this?" — a subtle but devastating shift.

Before you finalize a bracket pick, read the case for the other team. Before you double down on a position, write out a serious bear case. The goal is not pessimism — it is intellectual honesty.

4. Loss Aversion

Research suggests most people feel the pain of the loss roughly twice as intensely as the joy of a gain. Kahneman called this “loss aversion,” and he showed it is hardwired into our brains from birth.

In March Madness, loss aversion drives people to pick favorites relentlessly, even when the expected value of an upset pick is higher. We protect our bracket's survival rather than optimizing for winning the pool. We anchor to our initial picks long after they should be reconsidered.

For investors, loss aversion leads to holding losing stocks far too long — hoping to "get back to breakeven" — and selling winners prematurely to lock in gains. Both behaviors sacrifice expected returns in service of emotional comfort. The result is a portfolio shaped more by feelings than by fundamentals.

How March Madness Can Make Us Better Investors

The most successful bracket players — and investors — share a few key traits.

1. They diversify their picks rather than over-concentrating on one narrative.

2. They respect base rates: historically, No. 1 seeds win the national championship more often than all other seeds combined. They manage their downside and stay in the game long enough for their process to pay off.

3. They also know when to trust the structure over the story. The tournament bracket is a process. A well-constructed investment policy statement is a process. Both exist to protect us from ourselves in high-emotion moments.

Before you submit your next bracket or make your next investment decision ask yourself: ”Am I making this pick because the data supports it, or because I watched them play two weeks ago and they outplayed their conference rivals with a better record? Am I buying this stock because I have a thesis, or because everyone on my feed is talking about it?”

Conclusion

March Madness lasts three weeks. The behavioral biases it exposes can last a lifetime. The court just makes it more obvious than a brokerage account does.

#Marchmadness, #NCAAbasketball, #behavioralbias, #investing

Is It Better to Be Published or Quoted?

 

P.T. Barnum, the iconic 19^th century showman liked to say: “All publicity is good publicity.”

That may be true. But I can’t tell you how many financial professionals contact us wanting to do “PR” for them. “We have such a great XYZ, but no one has heard of us,” they lament, assuming media outlets should be breaking down the door to do stories about them.

In today’s era of shrinking newsrooms, that kind of “earned media” coverage is harder and harder to do. It’s simple math. Newsrooms are shrinking at even the best newspapers, magazines and broadcast outlets. The editors and reporters who remain are completely overloaded and don’t have time for coffee, lunch, golf or 15-minute meet-and-greets just to get to know you. They’re under constant pressure to meet tight deadlines with timely, relevant content that will keep the audience engaged and advertisers happy.

And now thanks to crowdsourced pitching services like Qwoted, Source Bottle and HARO (Help a Reporter Out), journalists are receiving more pitches than ever for fewer and fewer coverage opportunities.

That’s why we recommend writing authoritative bylined columns for reputable media outlets cover your industry.

Here are some of the advantages of bylined columns over simply being quoted:

• Recognition and Authority: Publishing establishes you as an expert in your field, whereas a quote often places the spotlight on the person who cited you.
  
  
• Control of the narrative: When you publish a bylined article, you control the narrative. When you’re simply quoted in an interview, your comments are just there to fill in the blanks in the reporter’s story – and there’s always the danger of being misquoted or being taken out of context.
  
  
• Career Advancement: Peer-reviewed publications directly lead to paid speaking gigs, new clients, podcast guest appearances, job opportunities, and consulting opportunities.
  
  
• Professional Development: The process of publishing improves writing and critical thinking skills, forcing the consolidation of complex ideas. After a few articles, you’re presentations and “elevator pitches” will get even better.
  
  
• Greater Impact: A published work allows others to build upon your findings, contributing to the broader development of a field.
  
  
• Validation: Being published means a publisher or reviewers validated the work's quality and value. That’s what cements your status as a bona fide thought leader.
  
  
•  Shelf life. Many of the specialized media outlets we work with build an archive landing page with all of your bylined columns listed, as well as your headshot and professional bio. Most media outlets keep the articles on their archive pages live for several years. You won’t get an archive page just being a source.

 
But I already have a good journalist relationship

If you can build a good relationship with a top journalist who covers your industry or geographic area, that’s great. Those relationships can be an invaluable source of earned media coverage, and you’ll eventually be considered a thought leader. You’ll likely get quoted several times per year – usually on short notice – for stories they’re working on. Just know that you can’t control when they publish, what the story is about, and most importantly, other experts being quoted in the story.

Most good journalists use multiple sources for their report, and you can’t control the order in which you’re quoted or if you’re quoted in the same story as a competitor, former partner or someone who is generally regarded as unethical in your space.

Again, as a source, you can’t control the narrative like you can as a guest columnist or regular contributor.

Conclusion

All PR is good PR, but the right PR is worth its weight in gold. Let me know what you’re doing to garner earned media coverage. I’d like to hear more.

#thoughtleadership, #bylinedarticles, #mediacoverage, #PR

Why Publish an Audiobook?

Our recent post Why Write a Book generated plenty of comments. One reader asked if it was better to do a print book or a digital book these days. Before answering that question, there’s a third option to consider – an audiobook. With today’s technology, you can convert your existing print book to audio.

When a listener hears your book in your own unique voice, the material becomes more vivid and more personal. It feels like a conversation instead of a presentation. “That is often what high-net-worth clients respond to,” Tina Dietz, CEO of Twin Flames Studios told me recently. “They want to understand not only what you know, but how you think under pressure, how you explain complexity, and how you make important decisions -- all critical attributes for financial advisors,” added Dietz.

Audio is also highly portable. Readers can listen to your words of wisdom while exercising, commuting, traveling, gardening or on breaks between meetings. This increases the amount of time they spend with your perspective, which strengthens familiarity with your approach.

“Audio gives financial advisors something print cannot: a leadership signature,” said Dietz. “It’s the sound of how you think and guide clients through complexity. For advisors who already publish regularly, an audiobook isn’t redundant; it’s the next evolution of your thought leadership,” she noted.

Studies show that audio produces 56% better attention and higher brand recall than online video.

Research also shows that audio outperforms other media in attention delivery, especially in mobile environments. One major industry study found that listeners rated long-form audio hosts at the same credibility level as journalists. The broader research also shows that long-form audio builds trust and creates a sense of connection between the speaker and the listener.

“This matters because clients selecting a financial advisor are evaluating temperament, philosophy, and judgment,” said Dietz. “Those qualities show up in your voice before you ever sit down together with a potential client. An audiobook becomes a pre-meeting trust accelerator that speaks for you in rooms that you’re not in yet,” she added.

Studies show that listeners feel a sense of telepresence -- an “I’m in the room with you” effect-when the narration is strong. “That emotional connectedness increases positive attitudes toward the narrator,” explained Dietz. “So, when someone spends several hours with your ideas in your voice, they’re not just understanding your philosophy, they’re forming a sense of your judgment, steadiness, and credibility, which is the foundation of trust with high-net-worth families,” Dietz asserted.

Business case for audiobooks

According to Diez, ROI from audiobooks doesn’t come from volume; it comes from fewer but better-aligned clients. As a result, she said audio gives you a disproportionate return on the time invested. “A one-time investment in a premium audiobook gives you a scalable asset that pre-educates and pre-aligns the exact clients you want,” said Dietz. “It reduces early-stage qualification time, strengthens relationships with centers of influence, and positions your thinking as the benchmark in your category long before anyone schedules a meeting.

Connecting with NextGen

According to Dietz, younger adults, which may include next-gen decisionmakers and future inheritors, are driving a massive shift toward audio-first content. Research shows that roughly one-third of adults under 30 listened to an audiobook in the last year, and Gen Z is the fastest-growing segment of audio-only podcast consumers.

If you’re advising multi-gen families or preparing for succession conversations, audio is the medium that the younger cohort prefers for consuming long-form ideas. “An audiobook becomes an asset that speaks in a format they’re more likely to engage with,” said Dietz. “It becomes a powerful tool for continuity planning and long-term influence,” she added.

For advisors who already have a strong reputation, audio becomes a force multiplier. It elevates your presence into environments where you can’t always be in the room, such as corporate board discussions, multi-generational family meetings, COI conversations, and even conferences where your ideas may be shared informally.

Audio also creates a permanent intellectual asset. “Markets change, strategies evolve, but your core philosophy, particularly the way you think and the principles you return to, becomes a lasting part of your professional legacy,” explained Dietz. “That has real value in succession planning and long-term brand equity,” she added.

The most common misconception is that producing an audiobook will be excessively time-intensive or technically overwhelming. Advisors imagine long days in a recording studio or complicated editing sessions. “The reality is the exact opposite,” said Dietz. “With a properly engineered remote-production model, advisors can record in short, manageable blocks, typically from their own office or home,” she said. “A good production partner can handle the entire technical side, including fully directing the recording sessions, capturing the highest quality audio, editing, mastering, and coordinating distribution,” she added.

Conclusion

The production quality should reflect the quality of your practice. The right partner amplifies your brand; the wrong partner dilutes it. Advisors should choose a partner who doesn’t just record audio, but who understands how to translate expertise into presence.

#thoughtleadership, #audiobooks, #practicedevelopment

Test Drive Resolutions Now Before Committing in 2026

As humans, we’re not very good at keeping promises to ourselves. Take New Year’s resolutions. Year after year we tell ourselves this lie: “After the Holidays I’ll get my fitness/finances/waistline/relationships back on track.” And what happens? Our resolutions stall out after a few weeks and the sting of regret hangs in the air like wet laundry over a long-ignored Peloton bike.

If this sounds like you, you’re not alone. Research shows four out of five New Year’s resolutions (81%) will be abandoned by mid-January. In fact, fitness app Strava found the majority of users had given up on their New Year’s resolutions by January 19 (aka national “Quitter’s Day”).

Here's something that may surprise you, however. Most resolutions don’t fail due to lack of willpower. They fail because we set goals that are way too ambitious. If you haven’t run a quarter mile since junior high school gym class, don’t resolve to run a marathon within six months. You might be able to pull that off in the movies, but in real life, you’re just setting yourself up for disappointment, injury and an unhealthy relapse.

However, if you start with 20 minutes of walking a day with a goal of completing a 5K run in six months, your odds of success go up exponentially. And from there, you can talk about completing a 10K or half-marathon before year-end with even more ambitious goals in 2027.

Whether we’re talking about fitness, finances, weight loss or relationships, behavior modification is hard. That’s why it’s so important to “test drive” your resolutions for a month or two before making a full commitment. This honeymoon period gives you time to see how much you can really handle and make course corrections along the way. If life is too hectic to start your test drive now, move the test drive to January with the goal of setting your 2026 resolutions in February.

Here are four tips for making the test-drive period even more effective:

1. Be SMART. New Year’s resolutions are a form of behavior modification. To make this changing mindset stick, you want to be SMART (Specific, Measurable, Actionable, Realistic and Time Specific).

Dan McMahon, managing partner of Integrated Growth Advisors, is a former football tight-end and no stranger to the ups and downs of weight change. A few weeks before Thanksgiving, Dan told me about his audacious goal to lose 40 pounds by May 1, 2026. Dropping 40 pounds may sound like a lot – especially when starting right before the Holidays -- but that works out to less than seven pounds per month or less than two pounds per week. Not a huge sacrifice and with the gradual approach, he’ll have plenty of time to make mid-course corrections.

In fact, without reducing his overall calories, Dan lost 18 pounds in the first two weeks of his journey. No pills or magic formulas here. He simply reduced the amount of carbs he was eating by about 90% and consumed more protein and fat to stay off hunger. He has also maintained his four-day-per-week exercise routine throughout the process.

While it might be tempting for Dan to get to his 40-pound weight loss goal way ahead of schedule, Dan’s sticking to the timetable, so he doesn’t peak too early and gain all the weight back. He told me the other day: “The easy pounds have been shed – mostly water weight and beer weight. Now the real work begins and I’m not going to rush it.”

2. Be consistent. As the old saying goes: “Missing once is an accident. Missing twice is the start of a new habit. Don’t make excuses. Find a way to do the work to the best of your ability and don’t beat yourself up when you have an off-day or a cheat day. Just keep making a little progress every day and move the ball down the field one yard at a time. My post Consistency Is Not Boring has more.

3. Turn resolutions into ingrained habits to make them more relatable. For example:

• Resolution: Quit smoking vs. Ingrained Habit: Stop smoking that one cigarette you have every morning after breakfast.
• Resolution: Eat healthy food vs. Ingrained Habit: Start substituting that one daily morning pastry for a banana.
• Resolution: Lose weight vs. Ingrained Habit: Every evening after work, go for a two to three-minute run or walk around the block.
• Resolution: Manage stress vs. Ingrained Habit: Meditate for two to three minutes every morning after you wake up.
• Resolution: Improve finances vs. Ingrained Habit: Save an extra 2 percent of each paycheck and put half into my 401(k)s low-cost index fund and the other half into a high-yield savings account at your bank.

*** For more on making resolutions habit forming, see Sahil Bloom’s 30 for 30 Challenge.

4.     Have an accountability partner. As the old saying goes, “it’s easier to let down yourself than it is to let down someone you trust.” Share your resolution with a person you can trust who won’t let you make excuses or talk you out of striving toward your goal.

Conclusion

Eating an entire elephant is impossible. But taking it one bite at a time makes a daunting challenge seem manageable. Tweak your resolutions all year long (See Step 4) and don’t beat yourself up for falling short. Instead of throwing in the towel, dust yourself, get back on the horse and set more realistic goals for the remainder of 2023.

As Napolean Hill famously said: “A goal is just a dream with a deadline.”  Take your goals for a test drive before diving in. Come MLK Day you’ll be glad you did.

How do you plan to stick to your resolutions in 2026? I’d love to hear from you.

#resolutions, #selfimprovement, #dedication, #goalsetting, #30for30

Why Write a Book?

Now is the time of year when financial professionals start planning and budgeting for 2026. Many of you have told me you’re “finally ready to buckle down” and write the book you’ve been contemplating for so many years. That’s great.

Contrary to what you might think, people are still reading plenty of books even in this limited attention-span YouTube, social media, TikTok age – especially non-fiction and business.

Global book sales project to grow at a CAGR of 4.2% according to Grandview Research. And non-fiction book sales (which include business, finance and management) are projected to grow even faster, at a CAGR of 4.9% from 2025 to 2030, according to Grandview. Perhaps people are finding solace in the ability to turn pages and skip around at their own pace -- and not have to download software, set a password and be bombarded with ads and chatbots.

That being said, if you decide to go forward, don’t go it alone. It’s easy to get discouraged, side-tracked or lost down a rabbit hole of research with no way to find your way out. Make sure you have an accountability partner to keep you on track, whether it’s a close friend, trusted colleague or professional editor.

You’re probably not going to get a six-figure advance or earn seven-figure royalties unless you get picked up by a major publishing house. Those fat advances tend to go to Hollywood celebrities, professional athletes and politicians with global reach. Most likely you’ll have to go the independent route. Just know that of the 3.5 million authors on Amazon, only about 1,000 will earn over $100,000 a year in royalties (.002%).

Book revenue beyond royalties

But there are still plenty of good reasons for accomplished financial professionals to write a book.
One of our CPA clients sells limited quantities of his three books ($100 cover price) but has earned over $100,000 in speaking fees and training sessions over the past two years. An estate planning client landed a $50 million case and a $100 million case thanks to his writing efforts. A family office principal has created a mastermind group for buyers of his book for which they earn continuing education credit. A wealth advisor confided that she had over half a dozen clients considering leaving her firm after their mid-year reviews. After her book was released in Q4 and shared with clients, not a single one left.

Writing a book builds authority, accelerates client trust, differentiates you from competitors, and generates new business. A published book serves as a powerful marketing tool that provides long-term, multi-purpose value beyond the initial effort. 

Here are 11 benefits of writing a book for busy financial professionals:

1. The "ultimate business card." A book instantly sets an advisor or accountant apart as an expert in their field in a way that standard credentials or a firm brochure cannot. It positions them as a thought leader with a deep understanding of their niche.

2. A tangible asset. Holding a physical book signals a significant investment of time and expertise, which builds consumer confidence. People are more likely to listen to someone who has literally "written the book" on a subject. 

3. Builds relationships before the first meeting. A book provides a way to establish a genuine, meaningful relationship with potential clients long before they step into an office. By sharing their philosophy and expertise through a book, advisors and accountants can connect with prospects on a deeper level.

4. Showcases personality and purpose. A book offers a unique opportunity to share personal stories and motivations, creating an emotional bond and empathetic connection with readers. This transparency helps potential clients feel they know and can trust the author. 

5. Specializes and targets niche clients. With a targeted book, an advisor can open doors to a specific, high-value audience. Writing a retirement planning book for tech-savvy professionals, for instance, makes the author stand out in a crowded market.

6. Signals a higher tier of service. A high-quality book, particularly a branded one from a hybrid publisher, can create a premium perception that allows an advisor to command higher fees. For clients weighing multiple options, a published book can be the deciding factor. 

7. Generates high-quality leads. A book can be used to generate warm leads by giving copies to prospects, clients (for referrals), and centers of influence, such as attorneys and real estate agents. A potential client who has read your book is already pre-qualified and familiar with your value proposition.

8. Creates content for ongoing marketing. A book is a content goldmine. Its chapters can be repurposed into blog posts, social media updates, webinars, and email campaigns, giving an advisor a coherent and strategic content plan for years.

9. Attracts PR and speaking opportunities. Journalists, podcasters, and event planners are more likely to book an interview with a published author. A book provides an attention-grabbing angle that can lead to valuable media exposure. 

10. Forces clarity and focus. The process of writing a book requires an advisor or accountant to crystallize their unique methodology, philosophy, and value proposition. This focus can help improve internal processes and offer more valuable services.

11. Improves communication skills. The act of articulating complex financial or accounting concepts in an accessible way sharpens an author's communication skills, which translates to more impactful client meetings. 

Conclusion

Becoming a published author puts you in rarefied company and helps you stand out in a crowd of purported “experts” and “thought leaders.” It takes courage to put your name and reputation on the line and codify a lifetime of experiences and knowledge into just a few hundred pages. It may not be an easy journey, but I don’t know a single author who regrets taking it.

I’d love to hear more about what you’re doing to stand out from the crowd.
#thoughtleadership, #practicemanagement, #businesscommunication, #bookauthor

You Can Never Be Too Clear

Early in my career I worked in business development. I once asked my boss if I was following up too often with a prospect. Her answer: “If I was being too aggressive the prospect would let me know.” I feel the same way when it comes to clarity in your writing and communication. You can never be too clear. People rarely if ever complain about that.

Take the abuse (or ignorance) of pronouns, which seems to be running rampant in business communication. For instance, which of the following sentences is correct?

1. David’s manager said that he will attend the meeting. 

2. I spoke to the client, shipper and packager. They don’t know if it will work. She voiced some concerns about cost again. 

3. The new report indicates a serious problem, but it is unclear.

4. When the medic prepared a flu shot for the officer, he winced.

If you said none of the above, then you’re correct. Let’s take a closer look at the issues.

 

Sentence 1: David’s manager said that he will attend the meeting. [Who will attend, David, or his manager?]
Better: David’s manager said that David will attend the meeting.

Sentence 2: I spoke to the client, shipper and packager. They don’t know if it will work. She voiced some concerns about cost again. [Who voiced concerns?]
Better: The client voiced some concerns about cost again.

Sentence 3: The new report indicates a serious problem, but it is unclear. [Is it the report or is it the problem?]
Better: The new report indicates a serious problem, but the report is not clear about the problem.

Sentence 4: When the medic prepared a flu shot for the officer, he winced. (Who winced—the pharmacist or the officer?)
Better: When the medic prepared a flu shot for the officer, the officer winced.

Watch your antecedents

Not to sound like your high school English teacher here, but an unclear pronoun reference occurs when the reader is unsure about which word the pronoun refers to (it's antecedent). To fix a pronoun reference error, substitute the correct noun for the pronoun or simply reword the sentence.

Trap #1 Missing antecedents

Avoid pronouns that don't refer back to any part of the sentence.

Unclear: The buyer called the mortgage office, but they didn't pick up. (Who is they?)
Better: The buyer called the mortgage office, but no brokers picked up.

Trap #2 Who, which, or that clauses divorced from their antecedents

A relative pronoun connects a dependent clause to the main clause. Like other pronouns, who, which, and that must refer to a specific noun or noun phrase. To create clarity, always place the relative pronoun immediately following the word it refers to.

Unclear: Return your surveys by Friday, which will complete the review process. (Which is unclear—it doesn’t refer to a specific noun.)
Better: By Friday, return your surveys, which will complete the review process.

Trap #3 It, this, that, or they used in reference to a whole sentence

These pronouns should refer to a specific noun, not an entire sentence.

Unclear: The building plan includes a co-working space, a gym, and a food court. This adheres to zoning code.
Better: The building plan includes a co-working space, a gym and a food court.. The multiple-use plan adheres to zoning codes.
OK, simple enough. But let's look closely at pronoun confusion when the stakes get a lot higher for legal compliance and investment decisions. We found it often occurs when a second (supporting) sentence is used to modify or enhance the previous sentence.

EXAMPLE #1: The Inflation Reduction Act (IRA) of 2022 introduced new tax incentives (and enhanced existing programs) for producing and investing in electricity by using non-fossil-fuel means.  The current Administration had clearly signaled that dismantling parts of this legislation was one of its priorities. While the decision has led to Congressional dissent from both sides, the OBBB takes a significant swipe at the incentives currently in place. 

PROBLEM: What does “this” refer to?

Better: The Inflation Reduction Act (IRA) of 2022 introduced new tax incentives (and enhanced existing programs) for producing and investing in electricity by using non-fossil-fuel means.  The current Administration had clearly signaled that dismantling parts of the IRA was one of its priorities. While the decision has led to Congressional dissent from both sides, the OBBB takes a significant swipe at the incentives currently in place. 

EXAMPLE #2: Common examples of undivided real estate interests are inherited homes passed down to multiple heirs, rental properties jointly owned by siblings or business partners, and family land that’s held for generational stewardship. This arrangement is also referred to as “tenancy in common” and the two terms may be used interchangeably.

PROBLEM: Does “this arrangement” refer to family land only or all type of undivided real estate?
Better: Common examples of undivided real estate interests are inherited homes passed down to multiple heirs, rental properties jointly owned by siblings or business partners, and family land that’s held for generational stewardship. Family land is also referred to as “tenancy in common” and the two terms may be used interchangeably.

Conclusion

Clear communication isn't just about good grammar—it's about protecting your business from costly misunderstandings. Whether you're drafting a contract, writing investment guidance, or simply updating your team, ambiguous pronouns can create confusion that leads to delays, disputes, and damaged relationships. Don’t rely exclusively on AI and grammar apps. When in doubt, repeat the noun and read back your work aloud.

How is your firm improving communication? I’d love to hear more.

#thoughtleadership, #practicemanagement, #businesscommunication

Are Your Forgetting 'For Example' When Writing or Presenting?

One of the great things about our business is that we get to work with some of the smartest minds in accounting, wealth management and estate planning. But all too often the “curse of knowledge” trips them up when they’re writing, presenting or being interviewed. Having encyclopedic knowledge of your subject area has many benefits – but sometimes briefer is better, and you don’t have to overwhelm your audience with every single thing you know about the tax code or investing or estate planning.

I’m not suggesting you dumb things down or distill everything into 140 characters. But sometimes it’s better just to give your audience a small sampling of what you know, rather than overwhelming them with a firehose of information.

Many of you work in highly technical areas. One of the best ways I’ve found to get your point across quickly without dumbing it down is to use two of the most powerful word in credibility marketing: “For example.”

"For example" is a powerful communication tool because it acts as a bridge between abstract ideas and real-world experiences your audience can relate to.

Early in high school, I remember a young math teacher who seemed hell-bent on putting a room full of freshman smart alecs in their place. When it came to Pythagorean theorem, he went into a lengthy discourse about Euclidian geometry, the evolution of the hypotenuse, with all kinds of convoluted lines and squiggles on the blackboard. Like most of my classmates, I was baffled and bombed the first quiz.

Fortunately, I took advantage of an after-school tutor. Within five minutes she explained, Pythagorean theorem explains the relationship of the two shorter sides of a right triangle, to the longer hypotenuse (a² + b² = c²). For example, in a right triangle, she said if the two shorter perpendicular sides are 3 feet and 4 feet, then the longer hypotenuse must be the square root of 3 feet and 4 feet. [3^{2 =} (9 feet) + 4^{2 =} (16 feet) ⁼ 25 feet]. So, the square root of 25 feet is 5 feet. I could visualize the triangle’s shape and could certainly relate to measurements in feet.

Here are some other reasons why “for example” is so effective in getting your points across quickly and effectively:

1. Clarifies Complex Ideas. When introducing abstract concepts, using “for example” breaks down the thought process into easily digestible chunks. The example acts as a mental shortcut for processing complex ideas.

Example: Explaining "opportunity cost" in economics might be abstract for some, but if you explain it with an example like choosing between buying a new car or going on vacation, it’s much easier for people to grasp.

2. Engages the Audience. Instead of simply stating "Effective leadership requires trust," showing how a successful leader (for example, Oprah or Steve Jobs) gained the trust of their teams makes the idea more compelling.

3. Builds Credibility. Using examples shows that you have a deep understanding of a complex topic, say tariffs, can apply your knowledge in practical situations. It lends authenticity to your message.

Example: Citing a historical example, like how the U.S. handled tariffs in the past (1930 Smoot-Hawley Act; 1980s US-Japan Steel Wars) helps reinforce the validity of your argument and shows that your ideas are grounded in reality.

4. Makes Arguments More Persuasive. Why it's powerful: By demonstrating a point with a specific example, you provide evidence that backs up your argument. This can make your claims more persuasive and difficult to dismiss.

Example: If you're arguing that a remote work policy boosts productivity, you could use an example of a company like Microsoft that has reported increased productivity from remote work initiatives.

5. Fosters Better Understanding. Why it's powerful: People remember and understand concrete examples much better than abstract theories.

Example: Instead of saying "Investing early is crucial," showing how someone who starts investing at age 22 versus age 42 has a significantly larger return due to compounding interest can make the idea more impactful.

6. Encourages Action or Reflection. When your reader/listener/client sees how an idea applies to a real-world scenario, they’re more likely to think about how they can apply it in their own lives or work.

Example: If you’re discussing the importance of time management, providing an example of a successful person’s time-blocking routine might inspire someone to adopt similar habits.

*** Here are more tips for using “For example” effectively

Real world example

As investors and their accountants were grinding through tax season earlier this year, a well-known financial services company published an investor brief touting the benefits of tax-loss harvesting.

Here's an excerpt:

“Tax-loss harvesting is a tried-and-true strategy for lowering taxes and potentially helping increase after-tax returns. When you tax-loss harvest, you'll pay taxes on your realized capital gains for the year, meaning you'll only consider your net gains—the amount you gained minus any investment losses you realized. Learning how to harvest tax losses is key to helping put your money to work. If you have realized capital gains, you can offset them by selling securities from one of your taxable accounts at a loss and reinvesting the money in a similar investment or rebalancing, if needed. When reinvesting the funds, it's important to be aware of the IRS wash-sale rule.”

Yawn!

Finally, about 14 paragraphs into the guide, the had the courtesy to give us the first “For example”:

For example: Let’s say you sell Investment A at a loss of $30,000, but later in the year you sell Investment B for a $25,000 gain. Your losses from Investment A would offset your entire gain from Investment B. That means you won't pay capital gains taxes on the $25K gain from Investment B —and you'll have $5,000 in losses left over. Under current tax rules, you can use up to $3,000 of that loss to offset your ordinary income, and you'd be able to use the remaining $2,000 to offset gains or income in future tax years.

Great example, but I bet most clients didn’t make it that far. Introduce “for example” early and often into your client meetings, presentations, blog posts and collateral materials. Your readers, stakeholders, staff and followers will thank you and share you.

Conclusion

As humanitarian Albert Schweitzer famously said: "Example is not the main thing in influencing others, it is the only thing." Tell me how your firm is simplifying complex topics for your staff, clients and followers. I’d love to hear more.

 #businesscommunication, #practicemanagement, #professionaldevelopment