Pre-Talk What is the best decision you ever made? What is your worst decision you made? Was the process used for each decision the same? Picture Talk Describe what is the above picture is trying to represent. Do you agree most people decide in this manner? How do you make your decisions? Article Highlights Sourced from Think about a decision you've made that you were totally convinced was the right way to go... but in retrospect realize was really dumb. If you want to make consistently better decisions -- especially when the choice you make is extremely important -- make sure you avoid the following mental traps. 1. Loss Avoidance We all tend to strongly prefer to avoid a loss than to acquire a gain. (Put more simply, we're much more likely to try to avoid losing $500 than to try to make $500.) The key is to properly value the potential loss. Often what we may lose isn't as valuable as we might think. And think of it this way: You can recover from almost any loss, but will you someday recover from not having done everything possible to achieve your dreams? 2. Recall Bias Scientists call recall bias "availability heuristic" (which is why I refer to it as recall bias). Recall bias says that if you recall something, it must be important -- or at least more important than an alternative not as easily recalled. That means we tend to give heavy weight to recent information and form opinions and make decisions biased toward whatever is recent. Recall bias says, "Well, I remember that ... so this must be true." But that doesn't mean this is the whole truth -- or in any way indicative of a larger truth. Always use what you recall as a springboard for doing more research to make sure you know everything you need to know... not just what you remember. 3. Survivor Bias
Pre-Talk What is the best decision you ever made? What is your worst decision you made? Was the process used for each decision the same? Picture Talk Describe what is the above picture is trying to represent. Do you agree most people decide in this manner? How do you make your decisions? Article Highlights Sourced from Think about a decision you've made that you were totally convinced was the right way to go... but in retrospect realize was really dumb. If you want to make consistently better decisions -- especially when the choice you make is extremely important -- make sure you avoid the following mental traps. 1. Loss Avoidance We all tend to strongly prefer to avoid a loss than to acquire a gain. (Put more simply, we're much more likely to try to avoid losing $500 than to try to make $500.) The key is to properly value the potential loss. Often what we may lose isn't as valuable as we might think. And think of it this way: You can recover from almost any loss, but will you someday recover from not having done everything possible to achieve your dreams? 2. Recall Bias Scientists call recall bias "availability heuristic" (which is why I refer to it as recall bias). Recall bias says that if you recall something, it must be important -- or at least more important than an alternative not as easily recalled. That means we tend to give heavy weight to recent information and form opinions and make decisions biased toward whatever is recent. Recall bias says, "Well, I remember that ... so this must be true." But that doesn't mean this is the whole truth -- or in any way indicative of a larger truth. Always use what you recall as a springboard for doing more research to make sure you know everything you need to know... not just what you remember. 3. Survivor Bias
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