283. Why Every Business Needs To Care About Personal Finances, with Merle van den Akker

Welcome to episode 283 of the Brainy Business Understanding the Psychology of why People Buy. In today's episode, I'm excited to introduce you to Merle Van Denaker of Money on the Mind.

Ready? Let's get started.

You are listening to the Brainy Business Podcast where we dig into the psychology of why people buy and help you incorporate behavioral economics into your business, making it more brain friendly. Now, here's your host, Melina Palmer.

Hello hello everyone.

My name is Melina Palmer and I want to welcome you to the Brainy Business Podcast. In today's conversation, I'm joined by Dr. Merle van den Ecker. Merle is a behavioral scientist who has recently completed a PhD at the Warwick Business School, studying the effect of different payment methods on personal finance management. She decided to leave academia to apply behavioral insights in the real world and has become a behavioral science manager at a financial wellbeing unit in an Australian bank. She continues to research and apply behavioral science to improve financial services and consumer financial well being. Next to this, Meryl is a science communicator running the blog Money on the Mind and the money psychologist TikTok Account where she disseminates insights from the intersection of behavioral science and personal personal finance. Last to not leave academia behind fully.

Merle also teaches behavioral science as well.

As courses on fintech developments at top Australian universities. Merle was also a finalist for Content Person of the Year in the Habit weekly awards in 2022 and 2021, if I'm not mistaken, along with myself and many other amazing content creators in the space, including next week's guest who won the award last year. In today's conversation, we're talking about personal finance. Yes, but don't worry, we definitely talk about how it applies to any and all businesses. Because even though it would be great to think that your team can compartmentalize and keep their personal life separate and not bring money stress and other stress with them on the job, it doesn't work that way. Stress at home can impact performance at work, and there are some ways businesses can be helping their employees to feel more more comfortable and do better work if they're thoughtful about personal finances and what's going on in the world around them and their company. Even if your company doesn't believe it's impacted by inflation or the massive layoffs that have been happening recently and we've been seeing across the news, think again. Merle and I dig in on how social media and other availability biases and hurting fueled messages impacting everyone and what companies can be doing to help their employees to feel more secure and less stressed really quickly. Before we get into the conversation, I want to be sure you know that there are links in the show notes for everything, including related past episodes, links to articles and books, and so much more. It's all within the app you're listening to and atthe brainy business.com283 now let's jump right in. Dr. Merle Van Denacker, welcome to the Brainy Business podcast.

Thanks for having me Melina, and the pretty good effort on the name. I'm gonna be honest.

Okay, I got there. I know that when I was saying when Ingrid Nguyenhus was on the show, that's one that's rough for me. And then I also recently had oh man, a name that is his first name is Tomas and that's easy and I know that I will I don't remember his last name well enough. It's a hyphenated one and it's rough but we made it through. So I know that you're just Merle. That's just Merle. Yeah. So for, for the the rest of this I'll just say hey Merle, thanks for being here. Yeah. So for feel like you are a very very. Not just feel like I know that you are a well known name in behavior circles from the work that you do in a similar approach to the work that I do. But for everyone who doesn't yet know you, can you share a little bit about who you are and the work that you do?

Yeah, absolutely. So I think if people know me, which is a big if, they would know me through Money on the Mind where I write about behavioral science, how it applies to personal finance. And I've dedicate an entire series to complaining about the PhD and the structure that is academia. And then I did this, as I said, whilst I was doing a PhD at the University of Warwick, which I've now finished. And then I thought, nah, I guess academia is not for me after I've written 20 posts complaining about it. And then I actually left academia and I left the UK to start working for a bank in Australia in their financial wellbeing unit. So still very much in the behavioral science meets personal finance sphere. That's definitely my niche. I'm unlikely to leave it anytime soon.

Yeah, well. And so we'll talk about the PhD side of it to start just as some how that comes in. So you completed your PhD in 2021. When did you finish your PhD?

Oh, very good question. Ish.

I guess it doesn't have to be.

Yeah, I think I finished November or December 2021.

Right.

Okay.

I know there's a whole period of time there that's a bit of a blur, but I know that you've been, you know, you were working on your PhD through most of the time that we've known each other and then what was your PhD in?

So I only researched how people handle different forms of money and in this case specifically contactless payments and mobile payments, and see how that changed their perceptions, their spending patterns, how easy it was for them to recall how much they had spent. So more personal finance. What a surprise.

Yeah, yeah. What did you find in that research?

No, such a really interesting one. So for anyone who's unfamiliar with research on payment methods. So it started when the credit card was. Well, not when the credit card was introduced because that happened in the 60s, but the research is very much from the 80s, 90s all the way through to the, to the naughties essentially. And it found that spending on a credit card is incredibly different to spending with cash. Who would have thought? You know, in hindsight everyone's like, yeah, duh, obviously. But a lot of behavioral signs in hindsight is very obvious. But that's the problem with hindsight, as we're well aware, because we have such a thing as the hindsight bias. So it was known for credit cards especially because they're a non concurrent payment method. But then the question remained, what happens with other also easier payment methods that are still concurrent. So think of the debit card. And of course contactless and mobile tend to be functions on a debit card, but could be on a credit card. So there's this entire literature on what happens when payment methods become easier, when they become quicker, and how this affects how people spend and how they handle and perceive their money. So it was very much in that domain that we started to look at what was happening as well in terms of the pain of paying, in terms of salience. And we found that with contactless. Yeah, because it is so much quicker and there's just a tap and you're essentially done with the entire action. There is. People do tend to spend a bit more, not a lot more, but they do spend a bit more and then they actually have a much worse recall for what they have spent. Now for mobile payments this was a bit different. So the literature exists on mobile payments links them to very quick, very rapid high cost debt accumulation. So think payday loans or not paying off your credit card debt, which obviously against an APR for like 20 to 30% is a very high cost debt to have and we don't actually find that at all in the data set that we have. We don't see people spend a lot more, we don't see them accrue debt, we don't see them dip into their savings. So we're wondering if that's maybe because it's a different methodology. We had a third party data set. A lot of the stuff that we have seen on mobile payments was from surveys. It was not a direct like data analysis. So not direct behavior, but mostly people's interpretation of their own behavior, which of course is a great source of information. But if you're measuring actual spending, as I think most of your listeners are well aware, then measures or self rated measures are maybe not the most reliable in this context.

Hmm, interesting. Mamie was wondering, assuming that I am understanding properly what you were saying you were looking at and what you didn't find there, I wonder if with mobile there's an opportunity to make that mental accounting a little bit more salient too with some of the apps and things where you have that visualization in a different way. I do have an episode on mental accounting that I'll link to in the show Notes, which is fun because like it's one that I don't talk about all that much. So it'll be fun to bring that back for everyone. Do you want to share a little bit about what mental accounting is and how that might be coming in?

Absolutely. So it can't be surprising that Richard Taylor gets mentioned in an episode on mental accounting. So mental accounting is this idea of essentially expenditure and resource tracking in your head. So and the way that the business accounts on where their creditors are, where their debtors are, how much in the red they are, hopefully they're on the black people can do it for their own personal finance as well, but they do so mentally. Obviously loads of people don't just do this in their head, which is why it's called mental accounting, but they also have financial tracker apps or they write it down. I know people with God knows how many Excel sheets, so that would be considered a mental accounting support or just regular accounting, if you will. And for full disclosure, the data set that we were using for both the contactless and the mobile payments, when we looked exclusively at spending and how it affected personal, personal financial management in general, we were looking at the data of a financial tracker app. So these are people who have installed such a tool and are tracking what's actually going on. It's hardly Surprising to see that the type of people who install a financial tracker app might not feel the full effects or ramifications of the onset of mobile payments. As in they suddenly start spending a lot more, they suddenly start dipping into debt because, well, quite frankly, they have a financial tracker app to indicate that this is going wrong before it starts spiraling, which we might have seen with other people.

Right.

And you know, with anything. Talk about context all the time and understanding the generalizability of data and academic research and things that we see. Right. And so know, um, it's important where I've had, you know, financial institutions as clients or if we're looking at stuff and you say like, well, we, we surveyed everyone that uses the app and found this. And so this is what everybody has. And you say, well, like there's some sampling error and things to be keeping in mind here. Right. To know that like the people that went and signed up for the app are not everyone. And we need to know who, who we're talking to, what we're looking at. And like you said that piece of being able to say that, you know, it was people that were already using an app like this. And so it's important to know that that's not the full general population of everything under every context. And so it's important to know what that means when we ask good and thoughtful questions in business.

No, absolutely. I mean, this is the thing where you can benchmark your sample against the overall sample or representative sample. Do they have for financial institutions, obviously, do they have the same number of accounts? Do they have the same type of spending patterns? Is their spending similar enough on average in total per category, the levels of debt that they're in, like they're, they're obviously their demographics, like, are they vaguely like, you know, the general representative sample, even if they are so in static markers, so most of their demographics, they're unlikely to be. Be in more dynamic so behavioral markers. And yeah, the person who signs up for a finance app is probably not the same as a person who does not sign up for a finance app. For better or for worse, it's difficult to tell if you don't have that data because they're not signed into the app.

Right, right. Yeah. Well, and then just knowing that how behavior is impacted based on something like mental accounting there. And it seems so natural to us to say, you know, using the credit card versus if you had cash in your wallet versus if you have to tap into your savings or go get a use a loan, maybe you already had a, you Know, line of credit or something and you're having to use that to buy it. Let's say you're looking to buy an Xbox or an iPhone or something. That's like maybe not a necessity, we'll say. And so, but you want it. And then it's, you know, if you have room on the credit card and you can just swipe, that feels very different than if you're putting actual cash dollars on the table, which is different from if you're having to pull some from your savings, which is different from, you know, getting a personal loan to pay for that. But even not. And people don't typically consider that a credit card is a personal loan.

Oh, it's a very expensive personal loan.

Right. And so knowing that that's important and that where all your money is essentially the same, whether it's in savings or checking or whatever. But we think about it differently if you have to go pull from somewhere else and having that thoughtfulness in advance when you think about where you're putting things and how it's easy to add on when you've already started buying all those sorts of things.

Oh God, yeah. This, this is the thing that I am very worried about. And like I tell people this all the time, although it's not financial advice because I'm most definitely not allowed to give that. But it's. I understand how co holding arises, obviously. I mean, this is one of the things that came out of mental accounting. Richard Thaler talks about this all the time, but it's just the idea of like you have a mental and a physical account for savings and you have a mental and a physical account for your credits, whether you are in debt or not. But co holding, so this idea of having both low yield savings and high cost debt at the same time, to a lot of people, if you explain it to them in economic terms, it's super counterintuitive. But there are a variety of explanations for really what this is and how people are managing this. And one of them is obviously this idea of you have a savings account to let it grow, as in you are building that buffer. And if you keep dipping into that buffer to make sure that you don't have credit card debt, but then at the end of every week, or the end of every month, or the end of every pay cycle, you keep racking up a credit card debt, keep paying it down with your savings, obviously you can start to see which habit is forming here, where the savings account is just a way to refill the credit card. And that's if you want to look at actually saving, if you want to properly build a positive savings balance, you've just gotten yourself into a habit which will not allow you to do, do that. And then as a result it becomes very problematic. So from an economic perspective, it is very difficult to understand co holding. From a more behavioral perspective, for a habit formation perspective, and maybe also for a discipline and a self control perspective, it is very easy to understand why co holding arises. Which is one of my favorite favorite aspects of behavioral science. Like I can explain most things to be economically unsound, but I can explain them to be psychologically very, very sound indeed.

Yeah, for sure. And the, you know, irrational isn't necessarily the right term to use, even though it's one that popularized. Right. Yeah. At this point as we are recording and we'll say that hopefully this will be more of a distant memory when the episode comes out. But right now. So just this week, I think was the announcement that, you know, Alphabet was laying off another 12,000 people. And we've been seeing, of course, Twitter and it's just all the, all the things that are happening and knowing that people are looking at diversifying what they're doing and are finding themselves in a scary place. Right. There's a lot of change and there's inflation and things going on. And I believe that's part of why when you reached out to me about having the conversation that this was something you wanted to be able to talk about.

Yeah, absolutely. I've been. I think behavioral science can contribute to the cost of living crisis in major ways. But I think one of the concerns for me is that when people act out of fear, they make some not so great decisions. Like, we know what System one is like and System one is not always a problem. It's for, for every, for every 20 decisions that we make, I'm sure system one gets the majority of them right. It's just we're not conscious of those decisions. As, you know, System one does this stuff automatically, which is completely valid. And that's how that works. And you know, we should be very thankful that it does, because if I have to think or activate System 2 for every decision ever, I think I'd have a very miserable life. But my concern with a lot of the cost of living stuff is that if you lose your job now, especially considering how the media is portraying what's going on, I think you'll be scared to bits. And I do have some serious concerns as to why the media has become so incredibly fear mongering. Maybe it's because, you know, I don't consume a lot of media. Some people find that very ignorant. I find that just smart for my mental health. But if I look at how media has progressed over the last decade, it's nothing but fear mongering. And I mean, obviously there are awful things happening in the world, but to be exposed to that 24, 7, to constantly be told the economy is collapsing, you need to prepare for hyperinflation. It's already here. No one can afford the utilities for, for people who are renting, prepare like that. Rent price is not going to be stable for much longer. You keep overloading people with negative information. And my fear, which is ironic in this case from this constant overload, is that what you're creating are people who are scared and who are starting to feel helpless. And what we know from really old school psychology literature learned helplessness is a very dangerous state. To get into this idea that you as an individual cannot act to have control over your own life or over your own situation and make the most of that. This idea that's all just going to pieces and there's nothing you can do about it. I mean, it might be somewhat realistic, but this is very much the worldview of someone with clinical depression. And we know that their worldview is more accurate. But that doesn't make it okay for people to constantly, or for the media to constantly re. Emphasize this and talk people through this and scream this at people because we. What you need in a crisis is people who are not sitting on the couch crying, which obviously is a very valid thing to do. If you've just lost your job and you are feeling overwhelmed, you know, let it all out. Absolutely acceptable. Probably a good idea is very cathartic, but you need to be able to get into a mindset where you are still able to act, where you're not just completely in this learned helplessness mind frame and that you can figure out, you know, grab someone, grab your partner, grab your friend, grab your parents, grab your. I know your grandmother, if you're fast, I don't know. And just figure out what you can still do. Because this idea of it all just spiraling out of control and you just letting it happen to you is, is very dangerous. That's. That's not going to help you in any way, shape or form.

Yeah, I too am one that I avoid watching the news as much as I can and try to find some reliable sources with summaries of things that I'm able to know what I need to know. My husband reads all the news of all the things and he'll make sure that I'm aware of important things that are going on that I can. And he's good at being, you know, have that kind of unbiased filter of like, you know, what's happening with a bunch of stuff. But I mean for sure, you know, availability bias and what we see, we think is so important and happening everywhere. And I really do think it's such an important point. I, I like what you were saying there of that connection that I don't think a lot of people take the time to evaluate for themselves and understanding the stress that is caused and how that ripples out into all these other areas of our life and how that's impacting how you show up at work, then maybe you're more likely to miss a deadline because you're stressed about these other things and you can't focus and then you don't send the most thoughtful email and you have a bad conversation with someone. But things can really spiral if you let that stress weigh on you and something that little bit of time pressure in the wrong place. I talk about this in what your employees need and can't tell you about how important having too much pressure on people's time is impacting the ability for them to do really good, thoughtful work for you. And I think in this way knowing that it would be great if we were able to compartmentalize everything and have the, you know, the stress at of like money stuff and news stuff and family pressures and whatever say, like, well, that's not a work thing. So it's not going to bother me now that doesn't happen. And so understanding this as you look from, you know, whether it's from the role you have with the bank that you're working at now in this financial wellness space, but even just, you know, if you were giving advice to people in any kind of business and thinking about their, their employees and the stress that they may be feeling right now. Do you have any thoughts or advice on how people can make it easier on their team and, and, and, or have the space to know that people are stressed and you know what you might want to do about that?

Yeah, no, it's, it's a really good question. So I full disclosure, I am very much a behavioral scientist in the process personal finance niche. So my advice is not of the academic level that it would be in that domain. But I mean I can extrapolate. So we, we do have research to show that people who have known poverty or extreme financial Stress during their life, especially their younger years, they grow up to have a completely different approach to money and also to stress. So what we see is that those who have known distress beforehand, they discount much more heavily, they are much more present biased and they are much more risk averse. So if you extrapolate that to just in general, people who have experienced a high level of stress, whether that is money related or not, in this case it is a bit of both. This absolutely money related, you know, cost of living crisis is very much a financial crisis, but it is also related to am I still secure in my job, Can I make it to the end of the month with these layoffs? Especially if you're in a tech or attack affiliated sector, should I be looking somewhere else? What am I supposed to do here? And you can just see the barrage of questions and the cognitive overload that starts to happen as soon as you ask yourself a single one. Because it starts spiraling and it starts avalanching and a never ending pit of worry. And if we see how people respond to that. So people will become more risk averse, while the majority of people will become more risk averse and the majority of people will become more present biased. And in terms of handling money and in terms of making big life choices, the present bias is actually a very inconvenient bias. I don't want to call it dangerous because I am fear mongering, which I absolutely stay away from. But the present bias is something that you should most definitely be aware of. Now if as an employer, you know this about your employees, you can expect some really weird and quirky decisions and you can expect cognitive overload. You can expect people who are acting as if they are extremely stressed because they are like this. Let's just acknowledge that fact. Right now. There are very few people who are gonna go through life currently finding it all very, very easy. That is a very privileged position to be, and the majority of people are not in that privileged position. Job security is not great, despite the employment markets in various parts of the world being incredibly. What you can do as an employer is to first of all recognize that this is going on. If you are completely ignorant to this, congratulations, you are very privileged and you have absolutely no empathy. If this is something that you're comfortable with, that's your problem, not mine. But for most of the people who actually have a bit of empathy in their body, in their bones, recognize the situation. If you feel, check in with your employees a bit more. Are they dealing with financial stressors, are they dealing with family Stressors and unsurprising. This is, this is starting to take the shape very much of how really good employers manage people or their employees through the pandemic. Because at the start of the pandemic this was actually a very similar conversation to be had where obviously it was all working from home and which I think was the first challenge, but it was also a challenge of uncertainty and insecurity. Lots of people, employees wise, they didn't know if they were still going to have a job. They didn't know if this working from home gig was actually going to work out or if this was actually a reason to have a lot of people fired because they couldn't see them in the office. And I think a lot of companies have navigated that to the best of their abilities and we've seen really positive case studies and I hope to see that now as well, where people have honest and open conversations with each other about what they are scared of and what they currently can and can't manage. And obviously, and this is very unfortunate, but this will set apart the very good employers from the very, very toxic ones. Because a toxic employer is not going to care and a very good employer is going to try to figure out with you what you can and can't manage. If there is, if there's financial stressors, if there's overtime that you can work, if there are different financial incentives or pay restructuring that could potentially work if you need, because of your family, because you might no longer be able to afford child care or daycare, if it would be beneficial for you to work three to four days a week and where that is financially feasible for you rather than working full time and these types of things. It is important to as an employee know what would and wouldn't work and to ask for that. You know, it is a courageous thing to have to do, to have to sit down with your employer and for an employer to be open and expect these types of conversations because they are coming because people aren't managing. And the fact that they aren't managing is hardly surprising with the current state that we're in.

Yeah, I think with that you were talking about the pandemic and one of the pieces of advice that I gave at that time and that I've talked about after, and I'm certainly not the only person that talked about this, but there's that value in the no update update and knowing that the, when you're on the side of the conversation that you know all the things that are happening. So when you're in Management and you know, you're talking about all these different aspects and trying to figure things out. Time is going in incredibly fast for you, right? And feeling like, okay, people are going to give us the benefit of the doubt. We'll give an update when we have something to say. They know we're working on it and it. And like going to bed at 2am and getting up at 6am to work again, it doesn't feel like there's that much of a gap and you're just trying everything you can to keep up on the other side. When you're in the stressed and don't know what's happening and you're worried about keeping your job and when are they going to tell us something? Time is going much, much slower where it feels. And you remember early in the pandemic, you're like refreshing. Is there an update? Is there an update? Is there an update? Has the CDC said anything? Is this what's happening? What's happening? You know, you're feeling the stress and minutes feel like hours. And so being able to give updates of something when you. And it would be nice to say that they shouldn't. People shouldn't feel that stress. They should just know that it's. If we're not saying anything that they'll be okay or whatnot. And so when there is something that you can share to show that you're talking about it, to show you're thinking about them, to know that this problem is happening whether you're addressing it or not. And it's often becoming worse if you're not talking about it. And I get, you know, the argument from someone in management at whatever company is, you know, we don't want to have to promise that nobody's going to lose their jobs because we don't know what's going to happen. And so if we don't talk about it, then we don't have to. Then we won't have to recoil back if. When something happens and get that but. And you don't have to promise something that you can't keep, but to say nothing is not helping. And so do you have any insight from your side of what you've seen people either do or not do or advice as far as helping to help people to feel they have that psychological safety, that they can feel some of that calmness? I think you were giving some really good suggestions there of the. A thing an employer can do to be helping the team doesn't have to mean that you are promising them that they'll never lose their job or giving them a huge pay increase to accommodate. There can be more thoughtful solutions of again balance of childcare time that they're able to be at home like looking for creative solutions to help people feel safe to bring up that they are looking for something and finding a way that the employer can help that's not going to cost them a lot of money I think will go a long way. You don't have to promise things that you can't commit to. You don't have to the thing that you immediately think you have to be giving someone and the only thing that would make them feel safe or secure or reduce some of that stress. So I recently had a conversation with Wendy Smith about her book Both and Thinking, which is fantastic and she's on the show too so we'll link to that in the show notes. But that we have this our brains look for binary answers to things and more often than not slash always there's an and there's a both there's it's not just A or B but there are all these other aspects that come into play. And if we can step back and look for those other solutions, reframe the problem and know that something like this with the stress that people are seeing and experiencing in the world with their finances, with fear mongering in the in the world, in this overwhelm in the brain that we could be then leaning to like you say, being really risk averse or in the decisions that are long term but then in the short term getting more of the things that help them to feel safe, maybe buying something that they shouldn't because of that present bias or making that problem worse and not realizing it and how that's going to play out having in our, you know, nudges language here, right? If we expect that error that people will be making and the way that the brain is going to be looking at everything differently including how they show up for you at work and knowing that the this stress is a thing that exists. If you can help your employees and your customers and be thinking about that mind state they're in, the mindset they're going to be dealing with, you can help to be a solution for people, whether it's customers or employees by having this overall awareness of what's happening in the world and how that's going to be impacting behavior. And it's not just about I'm sure there are people that saw we're talking about personal finance and like that being your aspect and say oh well that's not I'm not in banking, so that doesn't apply to me.

Personal finance applies to everyone. Which, I mean, this is the thing, right. So a couple of other things that I'm a bit worried about. So this idea of like a no update update, as boring as it sounds, because it's not exactly an entertaining option, but a lot of like boring stuff is actually very effective. If you give someone a no update update, even if it's just saying on like a weekly or every three day kind of update, being like, hey guys, you know, we talked about this last week. We've got these meetings in place, we've got these systems in place. This, this is likely to happen. We're still very much on track for that. No change. Keep, you know, posted until I know, early April and we'll, we'll have had these chats, we'll have had these talks. Still on track, no changes until then. I mean no changes until then is maybe a bit of a promise, but if you're promising on the short term, you might actually be able to do so convincingly and to do so truthfully. Most importantly, I think a lot of people do actually find that very, very helpful because as you've already mentioned, if your brain is on overload, the last thing at once is ambiguity. Because although the majority of people is risk averse, there's a whole bunch of people who are still risk seeking or risk neutral. I can promise you there's a lot more people who are ambiguity averse and there's not a lot of people who like love the unknown. Like it's not, it's, it's, that's not it. If you are scared of losing your job, scared that you won't make it till next month's mortgage or rent payment and now also your job is giving you no information. That is pure panic. That is pure fear. And if you can just reduce deuce a lot of that or even just, you know, a 10% amount of that by just giving people a no update update, give them the bloody two sentence email like it's not, it's no skin off your back, you're gonna be fine. And they have something that they can rely on, obviously. Don't blatantly lie and do, you know, do phrase things as if you would like to read them yourself. Don't phrase them in this very fake optimistic type of way, which I associate with Americans, no offense, don't, just don't write them down in a Dutch really direct, we don't really care type of way. That's also Awful. But somewhere like a happy medium, somewhere like the Canadian way of writing emails I think would be very nice. Like a, a neutral. This is where we're at. You know, if you have any questions, feel free to reach out and then of course an apology in there somewhere because Canada. But you know, this, this type of stuff like have, have the heart to send out these types of things and it will actually be helpful because the last thing you want for people is to act out of fear because they will likely, at least from what we've seen in literature and prior case studies, they will make decisions which in the long term are not to their benefit. And that is something we should really try to avoid. And to get back to the finfluences because I'll never leave this topic alone, but I have seen seen in a trend in social media consumption is that again influencers, especially the influencers that talk about how to get rich out of this recession is just booming, that is booming. It's growing so rapidly. The interaction with that is so massive, but without it sounding like financial advice. If you are currently in an incredibly unstable situation and you don't know what you're doing, realistically investing your entire savings balance, hoping to get rich and as a result not having an emergency buffer or any buffer at all is a terrible idea. But this is something that is now becoming incredibly popular and again it's this idea of someone has made it. You don't want to be in a situation that you're currently in, you want to be more stable and as a result you're taking absolutely non tailored advice and hope that applies to your situation. And this is just something that I really don't want to see because that is, I don't want to say it's a bunch of vultures profiteering of other people suffering because that's for most finfluencers that's not what it is, but it is misguided. And if people have a lot of ambiguity, aversion and they're currently in a situation with a lot of ambiguity, they will try to find infinite information somewhere. And then social media, because it's such a prevalent source of quote unquote information, is a source where a lot of people turn to and I think people, employers, friends, family, professionals, they should be aware of this because we will continuously see this, you know, despite it potentially possibly being very problematic.

Right. And then just to know that your own. So getting back to that availability bias piece and knowing that with social media in particular and what you're finding online, the algorithm is giving you more of what you're showing interest in and what you're looking for. And so something may feel like it's everywhere when it's because you are only clicking on things about passive income. And so you keep being shown more of it and so it may feel like it's very prominent. I think that this was something potentially in the like great resignation and quiet quitting where you're seeing and it feels like everyone is leaving their jobs in these dramatic fashion and so I should do that too. But potentially you're only seeing them because that's what you're searching for and you're seeing the same ones again and again. So understanding our confirmation bias, like we said, the survivorship bias piece, knowing how you know the, the influencer that is speaking to you about the thing and I'm by no means trying to call out anyone in specifically and like you said, a lot of people are very, very well intentioned in what they are doing. And you can make money online, it's true, you can. And knowing that the person who is pitching you the idea of a thing may make money in a different way than what they're telling you that you should do to make money. And so just to like you said, when, when you're stressed, when this is going on and you're feeling the, the pull of, you know, there's that fear of missing out too when we see the hurting and it feels like everyone is doing this and I don't want to miss so I'm just going to go ahead and I'm going to invest in the NFTs because.

Oh God, yes, that disaster.

Yeah. So all those things that people may make a decision that they would later regret even if they, you know, have, have a job they're not going to lose or if they've recently are going through a transition, just all these things to have some always take the time to take the breath to get out of that hot state and to look and see what they can be doing a little bit differently. Having awareness of where you are, what's going on around you, when you're feeling the need to make a choice and I think again on the, the side of the, the business, the employers, to know that even if you're, you know, feeling pretty stable and like you're not going to be losing people or you're not going to be laying people off and that the, you're. They have jobs so they shouldn't worry about it. Know that people feel stress and it really is something that if you, you don't have to pay a bunch of attention to it, but those who do are going to be much better off be better work places where people feel, feel more safe and then in that way you get better output. There's a lot better work, better decisions. Just it's really better for everyone all around if you can, you know, remember that we're all human at the end of the day and you have a team full of humans. At least for now as we're getting more in AI and things. But being able to keep that in mind to make it so people are able to do their best and feel safe and know that there's a win in it for the company too.

Yeah, absolutely. It is a win win situation to have employees who are not just cowering under an enormous load of stress and fear and as a result being rendered almost non functional. Of course there's a win in there for everyone.

Yeah, definitely. Well Merle, thanks so much for coming on the show to talk about just such a wide range of things and hopefully people are leaving from this episode feeling like that they, I'm sure that you know, you learned something and hopefully are not feeling like if they, if they were stressed, hopefully knowing that there is some opportunity for them to have a different outcome. And for everyone who wants to be learning more about you, to connect to, read more, to hear more from you, you know what their next best step to connect with you.

Oh, you can find me on any social media platform. So honestly seek me out on Twitter, seek me out on LinkedIn. I'm sure there'll be link below. I almost ironically have a TikTok where you can find me where I do not give financial advice. I am not a finfluencer. I'll have you know, or check out the blog, you know, money on the mind. And just if you want to know something, if you want to discuss any of what we've mentioned any further, please reach out. I'm always happy to chat. I love this stuff. I breathe this stuff.

Perfect. Well we will definitely have those links in the show notes to make it easy for everyone. And Merle, thanks again for joining me on the show. It was a lot of fun to talk with you today.

Always happy to talk to you Melina.

Thank you again to Dr. Merle Van Denaker for joining me on the show today. What got your brain buzzing in today's conversation? For me, I think it was a lot of fun to explore these areas that may not seem like they apply to a company where a lot of managers or executives may say or think, well, that's not our problem and show that it is. And if you focus on helping your people with more aspects of their lives than just what feels immediately relevant to your bottom line, it can have really great impacts, financially and otherwise. I'm reminded of the episode with Doug Kenreck and Dave Lundberg Kenreck on Solving Modern Problems with a Stone Age Brain where we talked about how companies can be helping their employees and customers to be thinking about these important motivators so they're more relevant. Even if it isn't what your company is about. What if it was? How can an awareness of pop culture or what's influencing your employees and customers on TikTok help you to be a better employer and business? It's important to know what's being shared and see where your company fits in. Is there misinformation being shared? Hopefully with the best intentions, but the damage is still done in a way that is so widespread that people believe it. How is that harmful and what can you do to help those people around you who may have been impacted? And remember, if you feel inclined to say that isn't your company's job, remember that stressed employees are less creative and less productive and are more likely to make mistakes and be less engaged and all sorts of other things that are costing you money and could lead to serious problems and mistakes. Investing a little in this area, even with some simple no update updates can make a big difference. Now before we close out the show, I want to be sure you know that there are links to related books, articles and past episodes in the show notes which are waiting for you in the app you're listening to and at the brainy business.com283 and thank you again to Dr. Merle Van Denacker for joining me on the show today. It was a delight to chat with.

And learn from you.

Join me Tuesday for another Brainy episode of the Brainy Business Podcast.

It's going to be a lot of fun.

You won't want to miss it. Until then, thanks again for listening and learning with me, and remember to be thoughtful.

Thank you for listening to the Brainy Business Podcast. Molina offers virtual strategy sessions, workshops and other services to help businesses be more brain friendly. For more free resources, visit thebrainybusiness.com it.