31 Oct 2025

Thinking: Solomon’s Paradox – the benefit of an ‘outside’ view.

King Solomon was legendary for his wisdom, and citizens sought his judgement as a sagacious resolution of their problems and disputes. And yet, his personal life was a shambles: plagued by short-sighted decision-making and a lack of restraint or sensibility.

This gives rise to the idea of Solomon’s Paradox – which observes that we are often much wiser in dealing with other people’s lives and problems compared with our own. Psychological studies suggest that this is a widespread cognitive bias, and we find it much easier to apply general wisdom – between ourselves and someone else, than to apply personal wisdom, which is between ourselves and our own affairs. Giving truth to the expression, “Do as I say, not as I do”.

There are ways to mitigate this problem. At their heart is the idea that if we want to give ourselves good advice, we ought to take a step back – perhaps to treat our lives as we would characters in a book.

A few different ways of doing this include:

• talking to yourself – ask yourself questions as a movie critic might do to a film-maker, to delve into your reasoning for decisions or actions;
• journaling – write things down and leave them, then come back, re-read and see what advice you would give yourself;
• identify with someone else – ask someone who knows you really well who they think you’re most like (e.g. a book or movie character or historical figure) – and then consider what advice you would give this character – it can be easier with a third-person in mind.

In our increasingly complex and information-overloaded age, one of the big problems with trying to go it alone, is being unaware of what you don’t know, or can’t see clearly from your vantage point. This is part of why most serious work is now a team effort, so that overlapping skill sets and knowledge can be used to complement each other. A team of various specialists will each attack a problem from different angles, and if they collaborate, they have a better chance of uncovering implicit assumptions or gaps in their thinking or the information they have.

Very often we find it hard to sort out personal finances for the same reasons as any other example of Solomon’s paradox:

• we can’t see the whole picture – we get bogged down or overly fixated on particular aspects of the situation
• we don’t know what might be missing – it’s hard to figure out for yourself what you may have completely overlooked
• pushing ourselves to prioritise and take action can be difficult amidst so many other competing demands in our lives
• specialist knowledge is time consuming to obtain and to keep updated in the face of shifting surroundings – whether they be tax changes, investment market trends, or other legal or regulatory considerations

For all of these reasons, nurturing an on-going relationship with a skilled financial planner can help you to keep your personal finances under review and to make timely course corrections, as well as major strategic shifts, when your circumstances or surroundings call for these.

How are you applying wisdom to your personal finances?  

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None of the above is financial or investment advice and you should speak to me or someone else professionally qualified to give you advice specifically tailored to your circumstances.