Choices and decisions can make or break a business, career or relationship.
One or two bad decisions can, and often are, forgiven.
But those who make poor choices and decisions too frequently either go out of business or find themselves on the unemployment line.
I’ve learned from my Rich Habits research that frequent bad decisions are actually habits.
What are some of those bad decision habits?
Impulsiveness
Twenty-seven percent of the entrepreneurs in my Rich Habits Study failed at least once in business. The top three reasons given for their failure were:
#1 Ran Out of Money
#2 Made Poor Decisions
#3 Had Bad Habits
One cause of poor decision-making is impulsiveness – meaning, making decisions before gathering all of the facts needed in order to make an informed decision.
If you are too lazy to do the heavy lifting good decisions require, delegate the heavy lifting to others.
Going with your gut can put you in bankruptcy court.
Taking Uneducated Risks
Taking risks without understanding all of the potential downsides, is another recipe for failure. Good decisions require that you take Educated Risks. One of the hallmarks of the self-made millionaires in my study was the Rich Habit of taking Educated Risks.
What is an Educated Risk?
- Doing Your Homework – Studying everything about investments that require your time or money, before committing to the investment, minimizes the risk of failure and increases your chances for success.
- Seek Expert Feedback – Seeking feedback from experts, helps open your eyes to pitfalls and opportunities.
Giving in to Immediate Needs or Wants
Sometimes you box yourself in and must make decisions in order to meet an immediate need. In effect, you are making decisions from a position of weakness in order to meet some short-term need.
Other times, you make decisions in order to satisfy some immediate want.
According to my Rich Habits research, every decision you make should create a long-term benefit. If it doesn’t, then it’s going to end up being a bad decision. So, as a rule, never make decisions in order to satisfy short-term needs or wants.
Lack of Adequate Sleep
The worst time to make a decision is when you are tired. The prefrontal cortex, the decision-making command and control center of the brain, clogs up and slows down when it is tired and needs rest. Also, when you are tired your willpower reserve will be very low.
The best time to make a decision is after a good night’s rest. So, the old adage, let me sleep on it, is smart thinking.
Making Decisions at the Wrong Time of the Day
In a recent University of Dundee Study, lead author Benjamin Vincent, PhD, found that individuals in one study group who made decisions after ten hours of fasting, consistently made the wrong decisions.
Conversely, the study group who made decisions within two hours of eating healthy food, consistently made the right decisions.
This disparity in decision-making was due to a loss of willpower reserve, also known as Decision Fatigue, which is a fancy term for lack of energy.
Never make a decision when you are hungry.
Also, never attend an important meeting, in which decisions will be made, when you are hungry.
Addictions/Excesses
If you have drug or alcohol addictions, or regularly drink or take drugs in excess, your prefrontal cortex will be impaired.
Do not make any decision while impaired and don’t let anyone you depend on make decisions on your behalf, while they are impaired.
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