Deep Life Reflections: Friday Five

Issue 136 - Decisions

Which recent decision left you wondering, ‘Did I get that right?’

Welcome to Issue 136 of Deep Life Reflections.

Discounting sleep, we make around 2,000 decisions per hour. Or one decision every two seconds. Typing this sentence involves over a hundred micro-decisions by my rough estimate. Typing this next line is another 50 or so. That’s a lot of decisions for two sentences.

In short, we are constantly making decisions. Some of them we are very aware of, like deciding to title this issue Decisions. Most we are not, like the typing example above.

This week’s issue is about decision-making and how we can improve it.

It’s inspired by the work of Nobel-Prize winning psychologist Daniel Kahneman. Kahneman’s life work, Thinking Fast and Slow, was featured in only my second issue of Deep Life Reflections, back in March 2023. I chose it because it’s one of the most valuable books in my library, a true heavyweight. Kahneman shows us where we can and can’t trust our intuitions, and how we can make better choices in every aspect of our lives.

Not that we are always going to make the best decisions. Fallibility is central to our design. How we react to a poor choice is how we learn. Or not. Kahneman’s work is more about highlighting the hidden mechanisms that hinder our ability to make a better decision in the myriad of infinite circumstances life presents, from the minuscule and mundane to the life changing and irreversible.

He gives us a torch in a room filled with shadows and shapes.

Below I’ve selected five specific ways Kahneman suggests we can make better decisions in our lives.

Maybe you’re already aware of them. Maybe they’re a good reminder. Either way, I’d love to hear your thoughts and reflections.

Decisions shape every aspect of our lives. You’re making one right now. Whether to continue reading or not.

I hope you will.

Here’s this week’s Friday Five to reflect on.

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5 Ways to Improve Your Decision-Making

Inspired by Nobel-Prize Winning Daniel Kahneman

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1. Don’t Trust Your First Instinct

Solve this problem.

A bat and a ball cost $1.10.

The bat costs one dollar more than the ball.

How much does the ball cost?

…

…

Did you get the right answer?

The ball costs 5 cents.

The bat doesn’t cost a dollar, it costs $1.05.

When asked this question, more than 50% of students at Harvard, MIT, and Princeton, gave the intuitive—and incorrect—answer: 10 cents. This reflects what Kahneman calls the ‘Lazy Controller,’ our tendency to follow the law of least effort.

It’s a moderately difficult problem, but solvable with just a few seconds of deliberate thought. This is one of the key themes of Thinking Fast and Slow: we are often overconfident and place too much faith in our intuitions.

Intuition serves us well and has its place. It’s been honed by evolution; a quick response to a threat improved our chances of survival. But when there are several ways of achieving the same goal, we tend to choose the least demanding one. The Lazy Controller at work.

“In the economy of action, effort is a cost, and the acquisition of skill is driven by the balance of benefits and costs. Laziness is built deep into our nature.”

Those who got the bat-and-ball example right could be called ‘engaged.’

“They are more alert, more intellectually active, less willing to be satisfied with superficially attractive answers, more sceptical about their intuitions.”

What this might teach us:

Slow down. Be cautious of placing too much trust in your intuitions when problem-solving. We’re wired to favour fast thinking as it takes less energy. But making better decisions means learning to activate our slower, more deliberate reasoning system.

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2. Loss Hurts More Than Gain

You may be familiar with Kahneman’s theory of loss aversion. His research reveals that for the average person the pain of losing is roughly twice as powerful as the pleasure of gaining.

If you accidentally dropped $100 on the street, the sting of that loss would be twice as sharp as the pleasure of winning the same amount in the lottery. This simple imbalance has far-reaching consequences.

“Loss aversion is a powerful conservative force that favours minimal changes from the status quo.”

In our daily lives, we are usually more willing to take risks to avoid a loss than to make a gain. We often favour the status quo because it feels ‘safer’, even though it might not be.

Where in your life do you consistently default to the safer option?

What this might teach us:

Loss aversion is a bias, not a truth. Being aware of it can help you take smarter risks to gain something meaningful. It could mean a new job, a different relationship, or even a move to a new city.

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3. Overcome the Sunk-Cost Fallacy

Another one you might already know. The sunk-cost fallacy describes our reluctance to abandon a course of action simply because we’ve already invested heavily in it. The sunk cost could be time, money, or effort. In poker terms, it’s being “pot committed”—we are playing this hand to the bitter end, no matter the outcome. Been there a few times…

The sunk-cost fallacy is a thinking error that distorts how we interpret information and influences our decision-making. The challenge is we keep contributing to these sunk costs even though we know it isn’t working for us.

An example is a financial savings product where we keep making monthly contributions despite the high fees and poor returns. It’s easier for us to justify pouring more money into it than to admit it was a failure.

It’s called a fallacy for a reason. It’s based on flawed logic.

You’ll see it in relationships, careers, even books you’re reading. “Well, I’ve come this far, I might as well finish it,” even if you’re not enjoying it and could be reading something far more worthwhile instead (in a world where you can only read a fraction of all the books ever written.) I’ve been there too…

“The sunk-cost fallacy keeps people for too long in poor jobs and unhappy marriages.”

What this might teach us:

Identify where you might be falling into the sunk-cost trap. Something, someone, or somewhere you’ve invested heavily, but know deep down it isn’t working. Then ask a simple yet powerful question to help you make a more rational choice:

‘What advice would I give to a friend in my situation?’

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4. How You Remember Isn’t How You Lived

The Peak-End Rule is a psychological shortcut where we judge an experience largely based on how we felt at its most intense point (the peak) and at its conclusion (the end). As a result, we rarely have an accurate memory of what the entire experience actually felt like.

Think of a holiday you went on. Your brain summarises the experience based on those two moments: the peak and the end. This summary belongs to what Kahneman calls the remembering self.

Let’s say you went to New York for five days. Your peak was a concert in Central Park; the end was a seat upgrade on the flight home. That’s what your remembering self stores as the highlight reel. But your experiencing self—what you actually felt over those five days—might say that most of the trip was spent feeling tired and run-down from jetlag and a virus. That’s not the version you tell friends. The concert and the upgrade are what you remember—and what you share.

“The experiencing self does not have a voice. The remembering self is sometimes wrong, but it is the one that keeps score and governs what we learn from living, and it is the one that makes decisions. What we learn from the past is to maximise the qualities of our future memories, not necessarily of our future experiences. This is the tyranny of the remembering self.”

Prestigious hotels understand the Peak-End Rule well. It’s why so many now focus on making the check-out process seamless and hassle-free. The last thing they want is a negative check-out experience for the guest, knowing it’s typically the final impression of someone’s holiday and therefore the memory they carry—and the story they’ll tell others.   

What this might teach us:

Recognising the power of the remembering self over the experiencing self helps us reflect on past events with more objectivity. It prevents false assumptions from shaping future decisions. This is also why writing about your experiences in the moment can be so valuable: it gives the experiencing self a voice, capturing how you really felt before that version is swept away by memory.

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5. Familiar Isn’t Fact

Availability bias is a mental shortcut that relies on the most immediate examples that come to mind when we evaluate a topic, decision, or situation. It’s the idea that if something can be recalled easily, it must be important, or at least more important than alternatives that don’t come to mind as readily.

Authoritarian regimes have long exploited this principle.

“A reliable way to make people believe in falsehoods is frequent repetition because familiarity is not easily distinguished from truth.”

Joseph Goebbels, chief propagandist for the Nazi Party, was a master of this tactic, flooding all communication channels across Germany with repeated falsehoods until they became accepted truths.

But availability bias isn’t limited to dark chapters in history. In everyday settings, business leaders often base decisions on the most recent or memorable information they’ve heard, rather than on a full assessment of the facts.

To counter this, Kahneman suggests a deceptively simple tool: something I call The Written Paragraph.

The rule: Before an important issue is discussed, every team member writes a short summary of their position. This captures a broader range of perspectives before the group conversation begins. In most meetings, those who speak early and assertively tend to dominate the discussion, and others fall in line. The Written Paragraph puts all views on the table from the start, leading to a much richer conversation and direction.

How many organisations follow this approach? I suspect not many, especially when speed and urgency tend to override depth and deliberation.

What this might teach us:

Awareness of availability bias means slowing down and asking whether the option that came to mind first is actually the best or just the one we’ve heard most. That’s a subtle distinction, but a vital one.

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Kahneman explores dozens of such glitches in our mental software in Thinking Fast and Slow. Some are benign, while others are deeply consequential.

With greater awareness, we can better assess when to use our intuition and when to tap into the benefits of slow and intentional thinking, helping us choose more wisely.

Better decisions won’t make life perfect. But they might make it clearer and calmer, a little more peace for ourselves and for those who depend on us.

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A Question for You

Which of the five methods resonates most, and where might you apply it more in your life?

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