I want to get a discussion going about what is better to focus on when creating success- your logic or your emotions? So often you hear, "Listen to your intuition" but then you also hear "The best way to create success is to look at what other people have done"- so should you look at facts or should you go with your feelings to create success?

You've got to use logic. But in doing so you also need to be happy with what you are doing after logically thinking through the consequences and outcomes.

If helping others makes you happy so you decide to pursue a career teaching in the third world then that is great but you need to be happy that you will never get rich.

Conversely you could work very hard and become a senior executive somewhere, make tons of money but be under enormous stress.

You need both. Emotions should be an input into your logic; you need to recognize that your emotions are part of you and will affect the success of your outcome. And logic should be an input into your emotions; if you logically recognize that an emotion is irrational, but can't change it based on that, you are in trouble.

If you mean, which is more important for business success? Logic. Intuition is not the same thing as emotions; it's closer to subconscious logic. The only emotions you need to have, understand, and effect are those of your customers.

I wholeheartedly agree.

It's a question that seems like it should have an easy answer, but in my experience it doesn't.

Financial success without happiness ( a product of satisfied emotions) is pretty futile.
And emotional happiness while running around creating a financial train-wreck is not only an unreasonable response, but argues a certain unwillingness to face reality.

That said, I've found that the emotional part does have to be dealt with or people just find ways to sabotage themselves over and over again no matter how good the logic may be. (Maybe that's not an issue if what you really want in life is simply to be rich and the rest doesn't matter so much?)

I think that the path to getting rich slowly has to be set on a firm foundation of desire. By that I mean that since by definition this is going to take a long time, you need to be able to keep a goal firmly in mind AND in your heart over a period of years and possibly decades. Really wanting something is an emotional state that helps funnel energy into what you're trying to accomplish and keeps you motivated.For most people, reaching your long-term goals is only doable through logic (tracking expenses, watching interest rates, etc.) and through emotion (picturing a goal clearly and putting everything you've got behind it!).

I'd say, figure out exactly why you're doing this. A desire for safety and security? A desire for freedom? Or some other reason personal only to you. Then put that head of steam to work motivating you to use the tools and processes of logic to achieve the goal that will make you happy.

(Personally, I'm working for options. Seriously, the less financial control you have, the fewer options you've got. The fewer options you've got; the harder you have to work to make anything go right.)

The answer is yes. This is one of those kinds of questions. You need the logic of maintaining a proper budget and balance sheet. You also need a life plan that consists of 7 categories with short, medium and long term goals in each of the categories. One of these categories is emotions. There are several others that are not career or financially oriented. You ignore these categories at your money's risk. If you do not address the emotional aspect as well as the other s when making financial decisions it will come back to bite you. Take all things into account when you make decisions that will affect your personal financial success and your life.

I also go with "Yes". Bottom line, our physical and emotional well-being is our goal, and our logical plan and action towards it is our means to that end.

So, what are the 7 categories? Why 7? Why not 3? or 9? or 6?

I'll throw in another observation:

Logic can often help you control your emotions and lead to better decisions. From an investing point of view, a logical person who truly understands finance and market behavior will be able to make investments with confidence of the long term behavior without emotion.

It you understand the logical behavior of random processes that determine market prices for stocks and bonds then you will be much more likely to not lose sleep or sell in a panic when there is a decline. Fear and greed are two emotions that get people in trouble when it comes to investing. Sympathy and wanting to "do good" are not far behind. The truth is that markets are unforgivable places that will eat you alive if you are too emotional about them or about making decisions.

Now, I will agree that making decisions based on how they outcome will improve emotions is fine.

In other words, emotions might be a good goal but they have no business as part of the decision criteria. Having enough money so you can spend a week enjoying the beach is a reasonable goal with a clear emotional component (feeling happy because you are sipping a maitai on the beach.) But deciding how to invest to meet that goal should not involve emotion!

The seven Categories are Spiritual, Emotional, Family, Career, Finances, Physical and Social. You can add some others such as Mental. It is not real anal. The point is not to be anal. The goal is to know where you are going or you might not get there. It is more like a vision for your future. It has always been interesting to me that when I have envisioned some goals I find that the path to acheiving them was clearly marked but I could not see it until I knew what I wanted. The other spin off is that this leads to acheiving goals long before you ever thought it was possible.

If you want to apply this to investing your short term goal should be to read the books by the "father" of value investing. He taught Warren Buffet how to invest. His name is Benjamin Graham. He has two books "The Intelligent Investor" and "Security Analysis". Money is logical. Value investing is logical. Value investing has nothing to do with emotions. Successful value investing is just following the numbers. They will tell you what to buy. You will never sell.

I read both of those books about 20 years ago!

Your point that "money is logical" is exactly what I am saying. There is nothing wrong with having "be happy with what I have done and make my family proud" as a goal. But happiness and pride have nothing to do with investing except that for some people, including me to an extent, ethics or morality come into play in setting restrictions on what is an investment option.

For example, sitting down and analyzing a bunch of stocks to determine which offer the best investment return is entirely logical. Eliminating a few of the top performers because you don't like their business practices or products is an emotional choice. Personally I will not buy cigarette companies. But that choice is not logical, it is emotional. And it has likely cost me money since a few tobacco companies have done quite well. But I am fine with that. However, if I were investing other people's money I think it would be completely inappropriate to apply my personal emotional opinions to the investment process. They simply do not belong. They are perfectly suitable to restricting how I achieve a personal goal but they are not part of the investment process.

Ok, I guess that is why life is so simple for me:

Spiritual - I have no need of it. Spirits don't exist.
Emotional - "Don't worry, be happy" has always worked for me.
Family - It's just my wife and I and we are of the same mind/goals/beliefs. I'm not worried about pleasing the limited extended family we have.
Career - I've already been very successful and found it's not all it's cracked up to be. Now my career goal is to have fun during the last few years until my very early retirement.
Finances - I have a few goals here
Physical - Also a few goals (marathon, ironman, etc.)
Social - I'm looking forward to leading those spammer death squads. Beyond that, I have friends but I don't see "social" as being something to have goals related to.

So, I'm not criticizing your list. I actually think it is pretty good. But of the categories that matter to me, I'm getting close to moving beyond them (career). I'd also replace "spiritual" with intellectual.

When it comes to making decisions, which was the original question, how does this play into it? Should one make a quantitative assessment of how a decision affects family, spiritual, etc?

ekrabs stated "Bottom line, our physical and emotional well-being is our goal, and our logical plan and action towards it is our means to that end." Add to that Family, Social and Spiritual you address the topic of success and happiness on a very balanced level. I agree money is not the only factor to consider when measuring success. A very balanced success seems to be the best success. Some very rich and successful people are not very happy.

To Doing Homework: This lifeplan goal setting is not a matrix or an algorithm especially because it is personal. The lifeplan is the personal part of personal finances. You sound pretty comfortable with yourself. Like I said in the earlier post, don't try to make this too tight. You already see your retirement vision. (I retired at age 52)More will come later especially on the physical side when you realize that part of your challenge will be to deal with your aging body. These goals are dynamic as time moves on and you change. That is why you will notice the changes when you review your goals over the years. You seem to understand this concept more than most people I have pitched it to.