Core Insights - There is a significant divergence between the expectations of financial advisors and individual investors regarding inflation and bond returns [2][3] - Advisors are more grounded in rational analysis, while investors are influenced by emotional experiences and biases [3] Inflation Expectations - Approximately 50% of individual investors anticipate inflation to reach 4% or higher in the next year, with 20% expecting it to exceed 6% [2] - In contrast, three-quarters of advisors predict inflation will remain between 2% and 4% [2] Bond Return Predictions - Most advisors expect 10-year US Treasury notes to yield between 3.5% and 4.5%, while nearly half of investors foresee returns below 3.5% [3] - Two-thirds of advisors plan to maintain their bond allocations, and 25% intend to increase their bond investments [4] Emotional Influence on Investment Decisions - The report highlights that advisors' emotional detachment allows them to provide better guidance, potentially adding 100 to 200 basis points to returns through behavioral coaching [3] - Investors' expectations are often shaped by personal experiences, such as "sticker shock" from rising grocery prices [3]