In this episode of Success That Lasts, Jared Siegel discusses why outcome bias works against us. He defines “resulting” and shares tips for getting comfortable with uncertainty and making better decisions.
Tune in here, at delapcpa.com/podcast, or wherever you listen to podcasts:
Here are a few highlights from this week's episode:
- Doing well with money isn’t about what you know; it’s about how you behave. You stand a greater chance of making smarter decisions about wealth if you change the way you think, which affects how you behave.
- “Resulting” is a term coined by poker players that defines the tendency to confuse the quality of a decision with the quality of its outcome. In cognitive science, this is called outcome bias, and it’s a dangerous tendency that we’re all susceptible to.
- “Diversification enables us to increase the near-term predictability that many of us need and desire,” Jared shares, “because we can't entirely eliminate uncertainty over shorter periods of time.”
- According to researcher Jonathan Haidt, we have two ways of thinking that work simultaneously at all times: our gut, which is quick, emotional, and very persuasive; and our head, which is slower and less powerful, but more objective than our gut.