How to make better (and quicker) decisions

 

Last week, I wrote about how I’ve embraced mindful shopping. I’m teaching myself to be more deliberate about the things I own and buy. My goal is to buy less and, more importantly, to own less.

As part of this, I don’t want to waste time shopping. I’m trying to train myself to make better decisions more quickly. This is tough for me to do.

By nature, I want to evaluate every alternative, to find the best option in every circumstance. Left to my own devices, I can spend two hours trying to decide which chainsaw is the best chainsaw at the best price.

There’s nothing wrong with this, of course. Comparison shopping is a good thing. But there’s a fine line. Some comparison can help you avoid purchasing poor products. Too much, on the other hand, becomes a tax on your time and your brainwidth.

I want to find a balance. I no longer feel the need to make a perfect decision. (Is there such a thing?) I’m becoming comfortable with the idea of accepting decisions that are “good enough”.

In short, I’m trying to incorporate lessons I’ve learned from The Paradox of Choice by Barry Schwartz so that I can take some of the suck out of shopping.

The Paradox of Choice

For those unfamiliar, Barry Schwartz is a psychology professor from Swarthmore College. His 2004 book The Paradox of Choice argues that while life without choice is almost unbearable, having too many choices carries burdens of its own.

“I believe that many modern Americans are feeling less and less satisfied even as their freedom of choice expands,” Schwartz writes. “Having too many choices produces psychological distress.”

This certainly rings true from my own experience. And not just with money decisions.

One of the joys of financial independence is the ability to choose how to spend your time. Indeed, this is a unique luxury. However, it’s also a burden. When you have an infinite number of options available, how do you make decisions about what to do with your time? (My answer, as you can probably guess, is to be clear about your purpose, and to make decisions aligned with that purpose.)

Schwartz argues that faced with so many options and decisions, we would be better off if we:

  • Embraced certain voluntary constraints on our choices (instead of rebelling against limits).
  • Opting for “good enough” instead of always seeking the best.
  • Lowering our expectations.
  • Made our decisions non-reversible.
  • Paid less attention to other people.

“A majority of people want more control over the details of their lives,” he writes, “but a majority of people also want to simplify their lives.” Schwartz calls this the paradox of choice. Greater choices creates greater complexity. That’s what we think we want. In reality, most folks crave simplicity — and simplicity requires fewer choices.

So, how can we confront this paradox? Is it possible to have the best of both worlds? How do we go about wrestling with the ever-increasing array of choices while simultaneously seeking simplicity.

That’s precisely what I’ve been trying to answer for myself lately.

At the end of The Paradox of Choice, Schwartz shares eleven steps that he believes can help mitigate (or eliminate) the distress caused by so much choice. Let’s look at four that I’ve found effective in my own life.

Learn to Love Constraints

“To manage the problem of excessive choice,” Schwartz writes, “we must decide which choices in our life matter and focus our time and energy there.” Establish personal rules of thumb and follow them. Artificially limit your number of choices. You might, for instance, have a rule that you’ll only visit two stores when shopping for clothing.

Here’s a real-life example of limiting your number of choices.

For the past six months, I’ve been in the market for a new vehicle. There are hundreds to choose form, and if I were to let myself look at the entire universe of new cars, I’d never make a decision. Instead, I’ve created my own “pocket universe” of cars to choose from: compact and sub-compact vehicles that are available in electric or hybrid versions.

Another great way to exercise contraint is to ignore all of the options that are available, especially for products you purchase regularly. Do you need to examine every cheese at the grocery store? Every can of soup? Every loaf of bread? Of course not. You have favorites. You have defaults.

Whenever possible, stick with what you know — especially if what you know already makes you happy.

Satisfice More and Mazimize Less

According to Schwartz, maximizers are those who only accept the best. Every time they make a choice, they want to make the best choice possible. And even after they do make a choice, they worry there might have been a better option.

Satisficers, on the other hand, have learned that contrary to conventional wisdom, good enough often is. They’re willing to settle for something other than the best. A satisficer still has expectations and standards, but once he’s found something that meets those standards, the search is over.

My cousin Duane is a maximizer. He agonizes over buying decisions — even ordering food in a restaurant.

Duane knows it doesn’t make much sense to deliberate over a menu decision, but he can’t help it. He can’t stop himself. “What if I choose something wrong?” he says, mocking himself. “That’s why I like buffets.” With a buffet, he has an “out” if he doesn’t like what he chooses. He can go choose something else.

I used to be like this too. Now, though, I take a different approach when dining out. I skim the menu until I find something I like, then I look no further. That first item I find is what I order. What’s the point of trying to pick the perfect meal? Will it make me any happier? Probably not. I’m satisfied choosing the first thing that looks good.

I took this approach when buying my chainsaw last week. It worked great! I’ve invested in the EGO Power+ series of battery-powered tools. I checked to see if they produce an electric chainsaw. They do, and it’s highly rated. I ordered it without looking at any other options.

Regret Less

After you’ve made a choice, move on. Don’t linger over other possibilities. Don’t second-guess yourself. If you buy stock in Dell instead of Apple, don’t continue to track Apple’s price. Stick with what you have.

More to the point, don’t compare your choices with other possibilities. “Our evaluation of our choices is profoundly affected by what we compare them with,” Schwartz writes, “including comparisons with alternatives that exist only in our imaginations.”

He argues that we can vastly improve our subjective experience by striving to be grateful for what’s good about our choices rather than being disappointed by what’s bad about them.

It’s also important to remember that most choices are complex. There’s rarely an option that’s clearly superior to all others in every single way. Each choice has its advantages and its disadvantages.

When faced with especially tough decisions, consider using the Jeff Bezos “regret minimization framework“.

Manage Expectations

How we feel about our decisions is strongly influenced by our expectations of the results. You might, for example, build up in your mind that a long-awaited Hawaiian vacation is going to be amazing — then it’s not. It’s fine, but it’s not nearly what you’d hoped.

The problem here isn’t Hawaii or the ocean or the hotel. The problem is the expectations you created for the experience. High expectations are the enemy of happiness.

Similarly, it’s important to remember hedonic adaptation will occur. Even if your new Tesla is thrilling during the first week of ownership, that thrill won’t last. You’ll gradually become accustomed to your new normal. Before long, that Tesla will seem mundane.

Schwartz argues that one of the best ways to control expectations and to anticipate hedonic adaptation is to be a satisficer rather than a maximizer. Don’t look for (or expect to find) the “perfect thing”. It doesn’t exist. If your aim is only satisfaction, your decisions are less likely to fall short of expectations.

Another way to manage expectations is to stop comparing yourself to others. Doing so is nearly always destructive to your sense of well-being. Don’t do it. Stop trying to keep up with the Joneses. “Focus on what makes you happy,” Schwartz writes, “and what gives meaning to your life.”

Thinking in Bets

Last year, I read and reviewed Thinking in Bets, Annie Duke’s book about making smarter decisions when you don’t have all the facts. (Here’s my review.) Duke says that we should stop thinking in terms of right and wrong. Few things are ever 0% or 100% likely to occur. Few people are ever 0% or 100% right about what they know or believe. Instead, we should think in bets.

According to Duke, all decisions are bets on the future. An unwanted result doesn’t mean we made a poor choice. It just means the bet didn’t pay off this one time. If you get a head injury in a motorcycle crash, that doesn’t mean wearing a helmet was a bad decision. It was a good decision, but this one result was poor.

“Job and relocation decisions are bets,” she writes. “Sales negotiations and contracts are bets. Buying a house is a bet. Ordering the chicken instead of the steak is a bet. Everything is a bet.”

In the year since I read her book, I’ve thought of this concept often. Another way for me to make better (and quicker) decisions is to embrace the idea that I’m betting on outcomes. When I buy something, I’m betting whether or not I’ll like it because it meets my needs.

Taken together, all of these ideas — those from Duke and those from Schwartz — are helping me spend less time deliberating over decisions and more time enjoying life.

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