Six ways consumers are biased and what this means for advisers

In its latest paper on adviser disclosure the regulator suggested creating a visual aid in the form of a label to help advisers illustrate information to their clients, including the adviser's status and charges. The research work which informed the regulator's thinking pointed to six forms of consumer bias advisers should be aware of when dealing with their clients. 1) Present bias Present bias is the tendency to over-value immediate rewards at the expense of our long-term intentions. Present bias typically leads people to over-borrow and pay down debt slower than they want. ...