'You need only watch episodes of Judge Judy': I'm in my 70s. Why do people keep making the same avoidable financial mistakes?

By Quentin Fottrell

'Consider some familiar examples of poor decisions: accumulating credit-card debt or failing to plan for retirement'

"Consider some familiar examples of poor decisions: refusing vaccines, accumulating credit-card debt, failing to plan for retirement or make a will." (Photo subject is a model.)

Dear Quentin,

Between my own experiences over 70 years and those of others, including you, it is clear that history is a great teacher. You have spent years sharing conventional wisdom and sage advice, yet each week you find yourself restating these lessons for your readers. I find this both amazing and perplexing. Why do smart solutions fade from memory? Who doesn't know that running up credit-card debt is a huge mistake?

Some people have the ability to recognize problems, assess possible remedies, seek wise advice and apply those lessons to their own circumstances. Others ignore sound advice, distrust it or never seek it, making less successful choices despite knowing the risks. You need only watch episodes of "Judge Judy" to see the mess even seemingly intelligent people can get themselves into.

Related: 'I'm naturally skeptical': I receive 10 calls a day offering me $15,000 loans at 8% interest. Is this a scam?

Poor decision-making

Consider some familiar examples of poor decisions: refusing vaccines, accumulating credit-card debt, failing to plan for retirement or make a will, choosing the wrong partner, driving drunk or without insurance, committing crimes or cheating, dropping out of school, developing an addiction, overeating, or spending recklessly rather than saving. Others, however, manage to rise above similar challenges.

So why do so many people believe they are different, better or smarter than others, walking into avoidable problems - or ones whose consequences could at least be mitigated - and then crying for help afterward? It certainly keeps advisers, lawyers, doctors, therapists, courts and prisons in business. People often override the wisdom offered by history. Poverty, bad luck and mental illness can also play a role.

Of course, countries and organizations face the same problem: repeating mistakes even after learning that they were mistakes the first time. Perhaps AI will be a game-changer. But will it be a force for good or another source of disaster? Time will tell. You must sometimes feel surprised or disappointed that you have to repeat the same advice over and over, only to see many people ignore it.

What has this taught you? And what hope is there that we can eventually reduce foolish behavior, help more people avoid trouble and enjoy better lives?

A Septuagenarian Reader

You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com. The Moneyist regrets he cannot reply to questions individually.

Related: 'I like the idea of a big return': My financial adviser wants me to invest $350,000 in a UAE data center. Is this risky?

I recognize that when we are inside the problem, it's sometimes hard to see the instructions on the jar.

Dear Septuagenarian,

There is a big chasm between total accountability and navigating life on life's terms.

I share your overall philosophy, up until a point. Surprisingly, perhaps, I don't often feel the same frustration you express in your letter when I read a letter where someone walks into a disastrous financial crisis. That's mostly because emotion, fear, stress and life get in the way of our big and small decisions, every day. I also recognize that when we are inside the problem, it's sometimes hard to see the instructions on the jar.

That's why we need wise elders like yourself, advice columnists, financial advisers (preferably those who don't work on commission and have a fiduciary duty to their clients), legal counsel and family and friends. Sometimes, the hardest thing to do is ask for help, and the easiest thing to do is give it. That puts you in an enviable position, someone with a level head who has never, or rarely, succumbed to temptation.

Pity those who graduated into the Great Recession.

The parts of your letter I agree with are these: Credit-card debt has hit $1.26 trillion; people sometimes panic when there's a stock-market correction, cashing out of equities and buying gold or bonds only to regret it later; and, yes, we are so busy trying to stay employed, pay the rent, and put food on the table as costs rise, we don't always keep on top of basic things like our health and/or balance our household budgets.

The lessons may appear to be the same, but the individuals often tell disturbing tales that only the gods could see coming. Your letter references how financial pressures, emotional turmoil, challenging workplace situations, addictions and mental-health challenges all play a role in how people deal with stressful situations. But timing is a critical component, too. (Pity those people who graduated into the Great Recession.)

To take one of your examples: obesity. The World Health Organization, which publishes the International Classification of Diseases; the American Medical Association; the Obesity Medicine Association; and the "Merck Manual of Diagnosis and Therapy" all classify obesity as a chronic, relapsing disease that is both a metabolic and neurobehavioral condition. "Food noise" is real. Hence, the seemingly miraculous success of GLP-1s.

Related: My sister moved in with our mother, 78, and says she deserves the $925,000 family home. Is she right?

Reverse engineering

Similarly, decades of research into addiction concludes that it is a disease involving compulsive seeking and taking of a substance or participation in an activity. The American Society of Addiction Medicine defines addiction as a chronic brain disorder. "Addiction doesn't happen from having a lack of willpower or as a result of making bad decisions," the Cleveland Clinic says. "Your brain chemistry changes with addiction."

Stress does the same to our brains. For others going through a difficult time - divorce, death, unexpected medical bills, a house with a dodgy foundation - studies show that chronic stress can alter your brain chemistry and lead to poor decision-making. Mental-health professionals say blood flow increases to our muscles during stressful periods as we enter survival mode, but there is a decrease in blood flow and oxygen to the brain, which can impair our cognitive functioning.

Stress can seriously impair our decision-making.

We all ultimately pay the piper and take accountability for our actions. You rob a bank or commit white-collar crime? You go to prison. You marry a person who love-bombed you into matrimony but turned out to be a bad actor? You abide by the divorce laws in your state, even if your spouse presents as a completely different person offering love, security, family and a future. Most people don't willingly walk into bad marriages.

It's easy, in retrospect, to reverse-engineer other people's finances, and say, "This is where you went wrong. Why couldn't you see that at the time?" How many people - like this fellow who liked video games that used Nvidia chips and decided to buy the company stock - got rich because of dumb luck, or an educated guess that could have gone either way? And how many people lost their shirts making similar gambles?

You mention AI. Goldman Sachs Research released a report last March saying AI is impacting jobs in the tech, knowledge and creative sectors, estimating 300 million jobs globally are exposed to AI-generated automation, while AI is also likely to help create jobs, particularly in power and data-center infrastructure. Tell that to a generation of mathematicians and computer engineers, who may find themselves threatened.

Writing this column over the years has taught me not to judge, but to try to understand.

Related: My wife says we can't afford to retire. I vetoed her $8,000 trip to Italy. We're in our 60s and have $4 million. Do I keep working?

By emailing your questions to The Moneyist or posting your dilemmas on The Moneyist Facebook group, you agree to have them published anonymously on MarketWatch.

More columns from Quentin Fottrell:

'I don't want to die on the sales floor': I'm 67 and earn $19.50 an hour at a big-box store. When can I finally retire?

'Some people did everything right': I lost my home in the Great Recession. I rent in my 50s. Why is that judged as failure?

'People in the U.S. need to wake up': As a mortgage loan officer, I rejected applications from wealthy couples. Here's why.

Check out The Moneyist's private Facebook group, where members help answer life's thorniest money issues. Post your questions, or weigh in on the latest Moneyist columns.

By submitting your story to Dow Jones & Co., the publisher of MarketWatch, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.

-Quentin Fottrell

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

10-26-26 1530ET