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Frameworks for Financial Decision Making

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Financial Counseling

Abstract

The study of financial decision making has a much longer history than most people realize. Dating back to the eighteenth century, Bernoulli introduced the concept of utility theory, which saw little development until the twentieth century. Since that time, additional theories and perspectives of financial decision making have been advanced, including the concept of bounded rationality, prospect theory, and the idea of two systems of decision making. Each of these theories and perspectives are discussed with particular attention to how financial counselors can use these frameworks in their practice.

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Author information

Authors and Affiliations

  1. The American College of Financial Services, Bryn Mawr, PA, USA

    Benjamin F. Cummings

  2. Morningstar, Inc., Washington, DC, USA

    Sarah Newcomb

Authors
  1. Benjamin F. Cummings
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  2. Sarah Newcomb
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Correspondence to Benjamin F. Cummings .

Editor information

Editors and Affiliations

  1. School of Family Studies and Human Services, Kansas State University, Manhattan, KS, USA

    Dorothy B. Durband

  2. Money Management Resource Center Personal Financial Planning program, Utah Valley University, Orem, UT, USA

    Ryan H. Law

  3. Financial Counseling Consultant, Lubbock, TX, USA

    Angela K. Mazzolini

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Cummings, B.F., Newcomb, S. (2019). Frameworks for Financial Decision Making. In: Durband, D., Law, R., Mazzolini, A. (eds) Financial Counseling. Springer, Cham. https://doi.org/10.1007/978-3-319-72586-4_9

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  • DOI: https://doi.org/10.1007/978-3-319-72586-4_9

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  • Publisher Name: Springer, Cham

  • Print ISBN: 978-3-319-72585-7

  • Online ISBN: 978-3-319-72586-4

  • eBook Packages: Social SciencesSocial Sciences (R0)

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