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Financial Goals

Thinking in Bets with Annie Duke

For most people, it’s difficult to say “I’m not sure” in a world that values and, even, rewards the appearance of certainty.

Articles by Jill Schlesinger

By Jill Schlesinger, CFP®
  |  Published: March 15, 2018

Daily life requires numerous decisions. Some easy, some difficult.  And some that have to be made without knowing a lot of pertinent information. And what we think is the best decision in the moment, doesn’t necessarily yield the best outcome.

There’s always an element of luck that you can’t control, and there is always information that is hidden from view. So perhaps the key to long-term success (and avoiding worrying yourself to death) is to think in bets:

  • How sure am I?
  • What are the possible ways things could turn out?
  • What decision has the highest odds of success?
  • Did I land in the unlucky 10% on the strategy that works 90% of the time?
  • Or is my success attributable to dumb luck rather than great decision making?

For most people, it’s difficult to say “I’m not sure” in a world that values and, even, rewards the appearance of certainty.

By shifting your thinking from a need for certainty to a goal of accurately assessing what you know and what you don’t, you’ll be less vulnerable to reactive emotions, knee-jerk biases, and destructive habits in your decision making.

You’ll become more confident, calm, compassionate and successful in the long run.

Listen to the full interview with Annie Duke

The opinions stated on the Better Off podcast are those of the host, Jill Schlesinger, and her guests, and not those of Betterment or its employees. Any third party links provided are offered as a matter of convenience and are not intended to imply that Betterment endorses, or is affiliated with the owners of or any information contained on those sites, unless expressly stated otherwise. Listen to a preview and subscribe to “Better Off” here.

 

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