Decisions, decisions... no easy way to say this

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Decisions, decisions... no easy way to say this

Gabor Balint • 30 April 2020

Money is involved, so it's simple, isn't it?

I have recently been lucky enough to be asked to be involved in someone's decision making process regarding some serious life choices where it seemed both quite straightforward and confusing to arrive at a conclusion, even though the financial costs and benefits were as clear and simple as you would ever want them to be. How can this be, you might wonder? Well, let me take you on a short mental journey.

Assume you have three choices that you have applied for and all three come back with a positive answer but one of them offers the best financial advantage. The first, immediate response would be to say: well there you are, the choice has been made for you by the purity of the finances. After all, if there is one certainty in life (apart from death and taxes to quote Benjamin Franklin or Daniel Defoe from the well reliable Wikipedia; don't judge me, I am not a historian, just a finance guy), it is that virtually every aspect of your life is somehow related to money and, assuming that the presence of money generally improves things, how could you turn down the best financial outcome?

I am glad you asked. Don't know if you are familiar with Daniel Kahnemann's work - and I don't only mean being marginally aware of his Nobel winning name but having actually read his stuff - and, in particular how people make decisions. If you haven't already, I suggest you buy a copy of his book 'Thinking, Fast and Slow' and give yourself time to digest it. In our household, I have to admit it lives on my bedside table, offering competition to Mrs B at bedtime...yes, I know, unfair competition, but who said life was fair?!?!?

What I mean to say is that there is a lot of potential downside to making snap decisions and, in particular, single dimension evaluations, ones that offer short term advantage. After all you are expecting to be around for quite a long time still after your decision, aren't you? So, wouldn't it be better to take a step back and start to make a mental effort to consider broader issues that will have a long-term impact on your life? In virtually every situation you are faced with, you have a choice. You are also blessed (OK, some time you feel like it's a curse) with a brain that, if you ask it nicely, is able to consider a lot more than the immediately obvious. In fact, it will thank you for doing this and if I could invoke a famous beer commercial, it probably guarantees a better decision (answers on a postcard, please).

So, make that effort, explore the previously unthought-of aspects of a dilemma or choice, find its component parts, what it actually would be to take one route or another, what the longer-term impacts are and where it leads you, set-up a multi-factor framework and then make a well-considered decision where money is just one component. After all, you want to be in control of money, not the other way around. I know you can do it and I also know - and can tell you from experience - that it leads to much better decisions and, in turn, much better life. You can do it. And if you can't, get in touch and I would be happy to help you - just to sign off on a long-term advertising campaign! :-)

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