Every March, millions of Americans fill out a bracket with absolute confidence.
“This is the year.”
“I’ve studied the matchups.”
“I’ve got a feeling about this 12 seed.”
And by Friday afternoon, it’s busted.
Not because we’re unintelligent. Not because we didn’t try. But because predicting outcomes, especially emotional, unpredictable ones, is difficult.
The same dynamic plays out in financial decisions more often than most people realize.
Research in behavioral finance consistently shows that emotions like fear, overconfidence, and comparison can quietly drive our choices, often in ways we don't recognize until the damage is done.
Much like a tournament bracket, even a well-constructed financial plan can fall apart for predictable (and avoidable) reasons.
| Tournament Upset | Financial Equivalent |
| Chasing Cinderella teams | Chasing hot investments |
| Moving the finish line | Lifestyle creep |
| Listening to the crowd | Reacting to financial headlines |
| Playing with no bench | Not having an emergency fund |
| Abandoning the plan | Panic decisions during downturns |
If you don’t want to bust your money bracket this year, here are five common financial mistakes that behavioral finance research consistently highlights.
Every tournament has a Cinderella team. Every year, investors go looking for one too:
In investing, the thrill of a Cinderella story rarely outperforms the consistency of a disciplined strategy. It’s like the old saying: “Portfolios are like bars of soap — the more you touch them, the smaller they get.”
Constant tinkering, switching, and chasing after shiny objects usually increases costs, taxes, and stress, without improving long-term results. On the other hand, a well-built portfolio requires discipline.
Key Takeaway: Let others chase Cinderellas. You succeed by sticking to your game plan.
Have you ever noticed this pattern? You get the new car. Finish the renovation. Hit a savings milestone. And within months, it all feels ordinary. So, you set a new target.
The quickest way to undermine financial progress is to keep moving the finish line. If “enough” is always slightly out of reach, you’ll never feel truly ahead.
One of the most underrated financial principles is this: Contentment is wanting what you already have.
In other words, financial success isn’t just about accumulation. It’s about learning to define “enough” and recognizing when you’ve reached it.
Key Takeaway: Financial progress becomes much harder when “enough” is always just out of reach.
Tournament games are loud. So is life.
Every day, you’re surrounded by messaging designed to make you feel afraid, greedy, or dissatisfied. News alerts. YouTube ads. Social media. Radio pundits. Market predictions.
Ask yourself: Have you ever finished watching the financial news and felt calmer? More grounded? More confident?
Probably not.
The noise makes everything feel urgent, but most headlines have little bearing on your long-term financial future. Reacting to every market swing or economic forecast is like changing your bracket after every possession.
Quiet the noise. Make fewer emotional decisions. Financial peace, more often than not, comes from tuning out rather than tuning in.
Key Takeaway: The more financial noise you react to, the more difficult it is to stay focused on your long-term goals.
Every great team has depth. You need it too.
A healthy emergency fund, a real margin for safety, is one of the most underrated financial tools available. Without adequate cash reserves, every unexpected event turns into a crisis:
When there’s no cushion, the only option is debt. And debt quietly compounds stress.
On the flip side, a financial plan works best when it includes room for the unexpected. Margin provides options, options reduce panic, and less panic results in better decisions.
Key Takeaway: A strong cash buffer won’t make headlines, but it wins championships.
Every tournament has surprises. So does every market cycle.
There will be downturns. There will be years that don’t feel good. But that doesn’t mean the strategy is broken.
One of the greatest advantages long-term investors have is endurance. Why? You don’t win by predicting every upset. You win by staying in the tournament.
Key Takeaway: Long-term financial success usually comes from endurance, not prediction.
Behavioral finance research shows that emotions like fear, overconfidence, and herd mentality can influence financial decisions, particularly during market volatility.
A well-crafted financial plan emphasizes long-term objectives over short-term market fluctuations. Frequent trading and emotional choices often hinder long-term investment outcomes.
There’s no one-size-fits-all answer, but a good rule of thumb is to aim for three to six months of essential living expenses in accessible savings to help handle unexpected expenses or income disruptions.
The people who “win” financially aren’t the ones who pick the perfect stock, time the market flawlessly, and avoid every mistake.
They’re the ones who:
So, enjoy the tournament this March. But when it comes to your finances, remember that championships aren’t won by chasing Cinderellas. They’re won by sticking to the fundamentals.
Any discussion of taxes is for general information purposes only, does not purport to be complete or cover every situation, and should not be construed as legal, tax, or accounting advice. Clients should confer with their qualified legal, tax, and accounting advisors as appropriate.
There is no guarantee that a diversified portfolio will outperform a non-diversified portfolio or that diversification among asset classes will reduce risk.
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Shane Tenny, CFP®, is Managing Partner of Spaugh Dameron Tenny, where he helps high-net-worth individuals and families navigate complex financial decisions with clarity, structure, and confidence. Since joining the firm in 2000, Shane has worked with clients through major financial transitions, including career changes, liquidity events, retirement, and multigenerational planning. His approach combines comprehensive financial planning with a focus on behavioral finance, including advanced studies in Behavioral Economics through the University of Chicago Booth School of Business. Shane is the author of Your Next Million, former host of the Prosperous Doc® Podcast, and a nationally recognized financial advisor, speaker, and educator.
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