Understanding the way that we think and make decisions is incredibly important when it comes to thinking about your benefits and your financial goals. Our minds work in an incredible way that enables us to make sense of the world without too much undue stress, but sometimes they can lead us in the wrong direction.
To improve our decision-making process, we should try understand how we naturally interpret events using the “rules of thumb” (or heuristics) our brains are wired to make. This prevents us from stressing out about many of our small decisions, but it also means we make many decisions without really considering whether we made the right decision or not. Ideally, make a quick judgment call on the potential impact of your decision, and proceed from there. When buying your morning coffee — and especially if you are in line in front of me— just make a decision.