Latest news with #Statman
Yahoo
27-04-2025
- Business
- Yahoo
How The Class Of 2025 Can Thrive In Today's Uncertain Job Market
Gen Z has already shown adaptability, jumping over employment hurdle after hurdle, and their future is still uncertain. As the class of 2025 prepares to enter the job market, the new March jobs report offers some insight to what's going on in the market. On the bright side, March brought 228,000 new jobs, surpassing February's slower 151,000-job growth. Wage growth held steady at 0.3% month-over-month, and sectors like healthcare and retail saw a hiring boost. The unemployment rate changed just a tad – creeping up slightly from 4.1% to 4.2% – a reminder of underlying challenges in the labor market. As graduation approaches and the job hunt begins, professors are sharing their best advice to help students navigate the twists and turns of today's ever-changing economy. First up is Meir Statman, Glenn Klimek Professor of Finance at Santa Clara University's Leavey School of Business. He's renowned for his work in behavioral finance, which bridges psychology and financial decision-making. His message to students? 'Sit tight,' he says. Leavey School of Business Professor Meir Statman – courtesy photo Statman urges graduates to resist the temptation to hyperfixate on fluctuating job market trends. 'Sometimes fear sets in – and people tend to extrapolate trends,' he explains. Instead of feeding into fear, he advises students to look inward and invest in understanding their unique skills and passions. 'Look for what you think is easy work – work that comes naturally to you that others compliment you on,' he suggests. Statman offers an analogy, comparing navigating the job market to a tennis match. 'Investing is like playing tennis against a practice wall,' he says. 'You can position yourself to bounce the ball back. But the job market is more like tennis against a random opponent; you might face an easy to beat opponent, or you might face Djokovic. Luck plays a role.' Rather than obsess over whether this moment in the labor market is Djokovic-level tough, Statman says students should give energy to the importance of networking and finding the right industry fit. 'The job market might be good or bad, but what matters most for getting a job is your ability to network. Focus on the things that improve your chances, regardless of market conditions,' he offers. In his new book, A Wealth of Well-Being: A Holistic Approach to Behavioral Finance, Statman discusses the broader concept of life well-being, urging people to move beyond financial goals alone. 'You need financial well-being for life well-being, but it is life well-being that we seek,' he says. He encourages students to consider risks outside the stock market – like social risks, or taking a chance on a career path or vocation they're passionate about, even in uncertain times. Reflecting on his own journey, Statman recalls taking the risk to leave Israel for the U.S. to pursue his Ph.D., a decision that reshaped his life and career despite its uncertainty. 'When job prospects aren't great, take the time to figure out what career is truly right for you. The most rewarding risk isn't financial – it's choosing the path that aligns with your purpose and strengths.' Over at Georgetown McDonough, Christine Murray, Associate Dean of Career Services, is all about empowering students to navigate today's unpredictable job market. With responsibilities of corporate development for MBA, graduate, and undergraduate programs, her advice for the Class of 2025 is to lean into resilience, adaptability, and confidence to thrive – not just now, but throughout their careers. 'The class of 2025 is entering a career landscape that has been up and down, but there's hope,' Murray says. Georgetown McDonough Associate Dean of Career Services, Christine Murray She is optimistic for her students. She says they're well-equipped with a global perspective, a Jesuit ethos, and teamwork skills that make them highly valued by employers. She has firsthand seen positive outlooks in the job market. For one, she's noticed a growing demand in consulting, and she also notes that healthcare is an industry that's continually growing. McDonough even has a new MBA certificate program designed to support graduated heading to their roles in this space. For Murray, success in a crowded job market starts with networking – though she acknowledges it can be intimidating. 'Networking doesn't have to mean walking into a huge room full of people and trying to be interesting. It's just a curious conversation,' she explains. 'It's 100% a must, especially in a competitive market.' It is also very important to gain relevant, forward-thinking skills, like experience with AI. Companies are actively seeking graduates who can integrate generative AI into projects and processes. 'Generative AI won't replace people, but people who don't use it might get left behind,' she says/ Beyond technical skills, Murray says the other most important thing studnets should do to increase their hirability is harness the power of their storytelling – specifically for their own stories: 'Being able to tell people what you stand for, what impact you want to have – it's a simple but powerful way to future-proof your career.' As for job market fears, Murray advises students not to let negative news cloud their outlook. 'People see layoffs at big companies and think, 'there's no room for me,' but that's the wrong approach,' she says. Instead, she encourages them to view their careers as a marathon, not a sprint. 'This is just one moment in time. You're setting up a foundation for long-term success. Don't let short-term trends deter you.' For the Class of 2025, the road ahead might be uncertain, but with the right mindset and skills, it's full of opportunity. The post How The Class Of 2025 Can Thrive In Today's Uncertain Job Market appeared first on Poets&Quants. Sign in to access your portfolio
Vox
08-04-2025
- Business
- Vox
The best financial advice right now is the most counterintuitive
The Trump administration's announcement of widespread tariffs has thrown the stock market into a tailspin, increasing the odds of a recession. This economic turmoil could have far-ranging implications, and some Americans' first question — and the outcome they believe they have most control over — is how to handle their retirement savings and other investments. While recent losses to your 401(k) account may inspire panic, experts caution most people (basically anyone not nearing retirement or recently retired, in which case the advice may vary) from making drastic changes to their investment strategy. The current financial situation is propelled by fear, says Meir Statman, a professor of finance at Santa Clara University and the author of A Wealth of Well-Being: A Holistic Approach to Behavioral Finance. While selling stocks during a downturn may feel satisfying in the short term and scratches the itch to take some sort of action, Statman says you need to rely on more than intuition in making significant financial moves. 'Surely I wish I sold my stocks on Tuesday of last week, but I didn't, and I cannot sell them now at last Tuesday's price,' Statman says. 'I know that in all likelihood, I'll be making the wrong decision, and that wrong decision is going to cost me if I get out now.' Today, Explained Understand the world with a daily explainer plus the most compelling stories of the day, compiled by news editor Sean Collins. Email (required) Sign Up By submitting your email, you agree to our Terms and Privacy Notice . This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply. The most sound financial guidance will also be the most familiar: Stay the course, don't let emotions be the sole driver of your decisions, and look to the past as a guide. 'It's much easier said than done to distract yourself and not look at your retirement account, not trade at a time of heightened volatility,' says Greg McBride, the chief financial analyst at Bankrate, 'but often the best step to take is to do nothing at all.' How emotions impact financial decisions Seeing losses in your portfolio elicits the same fight-or-flight response as other physical or psychological threats, says Danielle Labotka, a behavioral scientist at investment research firm Morningstar. So it's natural to want to pull your money out of the stock market. But in order to invest well, you need to act against this impulse. 'Our brain says, 'This is really bad. It feels really bad. You need to do something, get out,'' Labotka says. 'The problem with that is that investing requires us to be patient. It requires us to stick to plans long term. It requires us to persevere when things are difficult and stay the course.' Both long-term and short-term financial decisions are driven by a mix of emotion and logic, Statman says. But it is important not to let feelings outweigh reason. Recent stock losses have prompted emotional reactions — fear, uncertainty, anger. At the same time, the logical thought process assumes the market will continue to fall based on how it has behaved over the past week. To prevent losing more money, people of course think it's time to sell their stocks. 'The best days in the market often come on the heels of the worst days in the market and nobody's going to ring a bell when it's time.' — Greg McBride, chief financial analyst at Bankrate However, taking the time to pause and consider the ramifications of your actions may deter you from making short-sighted financial moves. Selling low typically results in a loss and you could come to regret that choice later on. It is also difficult to gauge the best time to buy and you may miss the upward trajectory. 'Studies have shown that missing the best days in the market significantly reduces your long-term rate of return,' McBride says. 'But the thing is, the best days in the market often come on the heels of the worst days in the market, and nobody's going to ring a bell when it's time for the market to turn around.' Each downturn feels uniquely scary — but think through long-term financial decisions While it is impossible to predict the future, looking at history can provide comfort. After each market crash over the last 150 years, the market not only recovered but continued to grow. Each moment of economic instability has a unique catalyst — currently, a budding international trade war — so it's difficult to make direct comparisons to the downturns caused by the pandemic or the bursting of the dot-com bubble, McBride says. But it can still be beneficial to understand overall trends. 'Look back at the past and say, 'Yes, this feels bad, yes, it may be bad for a while. Who knows?' Labotka says. 'But history tells us that it will end.' But because no one can predict the exact details of our financial future — which tariffs will be implemented, which will be walked back, how the market will respond — the best way to cope with the unknown, experts say, is to do nothing, at least for the time-being. This can be particularly distressing advice while watching the numbers in your retirement or investment accounts dwindling. But experts agree to try to keep this news out of mind as much as possible. Try limiting how much financial information you consume, deleting investment apps from your phone, or consulting with a financial adviser who can manage your investments for you. It's best to create some distance between your knee-jerk impulse and action, Labotka says. Consider what has changed for you financially since the tariffs were announced — 'not what has changed in the markets,' she says. This involves thinking about why you're investing. Maybe that's to better support your loved ones in the future or to donate to worthy causes. Then, think about your financial goals: to retire by 65 or to pay for your kids to go to college. If those motivators and goals haven't changed, neither should your strategy. 'Most likely, your financial plan already accounts for the fact that you're going to have these days in the market where things go horribly awry,' Labotka says, 'and therefore you should stick with the plan, because the plan already accounts for it.' 'Most likely, your financial plan already accounts for the fact that you're going to have these days in the market where things go horribly awry, and therefore you should stick with the plan.' — Danielle Labotka, behavioral scientist at Morningstar If you do need to make adjustments to your financial plan, Labotka says to increase your cash savings. However, don't divest your stocks just to put that money in the bank. Instead, see where you can cut recreational spending or tighten your budget to offer more of a savings cushion. You may also choose to put a little less money toward your 401(k) and instead put it into a savings account. (But do not stop contributing to your retirement fund altogether.) Older adults, meanwhile, should shift to a more conservative investment strategy to minimize the level of volatility they're exposed to. Get used to uncertainty It's okay to acknowledge how the current economic situation is impacting your feelings, Labotka says. If you fail to properly deal with your fear, anxiety, discomfort, or anger, you may rush to eliminate unpleasant emotions with rash decisions. 'When you do that, you're going to be inflicting harm upon your future self,' Labotka says. 'Because in the moment, you're going to feel relieved, but in the future, you're going to be like, 'Wow, I really lost out on a lot of money because I panicked in the moment and sold so that I could feel good then.'' As counterintuitive as it may seem, getting comfortable with economic uncertainty can help you better prepare for when it inevitably happens again. Resist the urge to act quickly and take the long view.
Forbes
06-04-2025
- Automotive
- Forbes
Building The Portfolio Of Life: Dr. Meir Statman's Fourfold Framework For Financial Well-Being
As a financial advisor, I have set my eyes on thousands of portfolios—but none as compelling or meaningful as the one Dr. Meir Statman described to me. In our recent conversation to discuss his newest book, A Wealth of Well-Being, the behavioral finance professor at Santa Clara University referenced a portfolio not simply consisting of financial assets, but a portfolio of life. Is it time for you to rebalance? Tim Maurer Like any good portfolio, it is purposefully diversified, but the asset classes are far broader than those we typically think of populating a 401(k) account. The portfolio of life consists of four types of capital: Let's discuss each and consider its significance. 'Financial capital consists of income and wealth and their utilitarian, expressive, and emotional benefits,' writes Dr. Statman. Our income, money, assets, and other tangible resources all fit into this slice of the portfolio pie, along with their accompanying benefits, which immediately signal Statman's behavioral finance thought leadership. The easiest way to explain the three benefits is through an example familiar to most of us—a car. The utilitarian benefit of the car is that it gets us where we need to go. The expressive benefit is that our car does say something about who we are as a person—or, at least, we may hope it does. And the emotional benefit is about how the car makes us feel. You may drive a Porsche to work (utilitarian) so that you can feel the rumble of the flat-six engine when you start it up (emotional) and because you don't mind turning a couple heads (expressive) when you pull into the office. Statman drives a Subaru because he doesn't need to impress his students with anything but his empathy and intellect (expressive), he loves the safety features (emotional), and he prefers a more frugal mode of transportation (utilitarian). Here's the key, though: Our financial capital is NOT the most important, but it supports all the other types. 'We need financial well-being to enjoy life well-being,' as Dr. Statman says, 'but it is life well-being that we seek.' Here's where things start to get a bit more opaque, but this is also where the real wisdom of this framework is illuminated. In A Wealth of Well-Being, social capital is defined as centered on 'social networks of people supporting one another by acceptance, trust, and cooperation.' Social capital can be as narrow as our family or as broad as an international constituency. For most of us, it also includes our friends, co-workers, neighbors, associations, and yes, even our LinkedIn network. In fact, as Statman writes, 'An experiment using LinkedIn data found that relatively weak ties in a broad social network were more helpful in finding jobs than strong ties in a narrow social network.' And as you can likely see, while we are well served to attend to these broad life portfolio categories, each individual asset class can—and optimally will be—further diversified. In this case, we're well served to recognize that our social capital is enriched by diversifying across those deeper, fewer connections as well as the more numerous casual relationships that often have an outsized positive impact when activated at the right time. Cultural capital is more easily felt than counted. It consists of our values, knowledge, education, and tradition. On an individual or family level, it is the exploration, discernment, and clear articulation of what is most important to us that guides how we date, marry, raise children, worship, and celebrate—and it is also a clear understanding of these priorities that is the optimal guide for our financial planning. When we know what's most important to us in life, while rarely easy, our financial decisions at least become simpler. Cultural consistency is also an imperative in our companies, while cultural conflicts can be problematic. 'Companies' stock prices increase when information indicates high cultural fit,' Statman writes, while 'companies that hire culturally disruptive managers suffer lower future market values and performance.' It's one of the reasons my company publishes our core values—greatness, growth, gratitude, grace, grit, and generosity—and yes, we use them for hiring, firing, and employee development decisions. Our personal capital includes physical and mental features, health, resilience, and emotional stability. Executive coach John Ott says that in corporate leadership only 23% of leadership effectiveness is about what you do—with 77% coming down to who you are. The who we are is powered by two traits, being: And I'd argue these are the two traits that also predict our effectiveness in every other area of life. What marital, parenting, or other relational challenges, for example, would not benefit from a greater dose of inward soundness—supported by sleep, diet, exercise, and spiritual practices—and being more inquisitive about and compassionate toward the others with whom we interact? And could there be a better reinvestment of our financial capital than into our personal capital bucket? The natural state of any diversified portfolio is that it will quickly be out of balance. That's actually the whole point—that while one area excels, another is often struggling. The question, therefore, is not if, but how and when, does your life portfolio need to be rebalanced? As you review the four capitals (and accompanying questions) above—financial, social, cultural, and personal—where are you currently excelling, and where are you struggling? Where can you reinvest your time, influence, money, energy, or relationships to balance your life portfolio better? And financial advisors, much as Dr. Richard Thaler, the Nobel prize-winning behavioral economist, implored that we must attend to the qualitative aspects of our work at least as much as the quantitative, Dr. Statman echoes this sentiment: As advisors, we likely dedicate too much attention to our clients' financial capital when it is rendered almost useless in the case of a job hunt (social capital) or a crisis of faith (cultural), and I believe there is likely no better reinvestment of money than in one's personal capital. It's hard—I know—to become students of humanity and to navigate the nuanced landscape of that which cannot be seen in a spreadsheet, but while a good advisor may help someone pile up a mountain of money and tax-efficiently distribute it, I believe an excellent advisor will be more focused on a wealth of well-being.
