My friend works with billionaires. He says their net worth can usually be traced back to just a few decisions they made over their lifetime. It’s rarely about hard work and long hours. Instead, it’s about making a handful of good strategic decisions.
Intrigued by his conclusion, my husband and I started talking about our own net worth. Even though we are very far from being billionaires, we noticed the same pattern:
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Hard work dictates your monthly income.
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The right decisions made at the right time dictate your net worth.
In our case, almost everything we have today comes down to five decisions we’ve made. Five! I’m not exaggerating. And only one of them was even slightly connected to a full-time job.
So if you want to improve the quality of your life, improving your decision making process is key.
And if “improving your life” doesn’t feel motivating enough, consider this: a lot of unnecessary suffering is caused by poor decisions.
Over the years, I’ve developed a simple framework that helps me make decisions about everything from family meal planning to big financial purchases to immigrating to another country.
The best place to start is with everyday decision making. Once you become good at small daily decisions, you can move on to bigger, long-term ones with much more confidence.
This post was inspired by a question I received during my office hours in Monthly Method School. A student was facing a difficult choice and asked how to make decisions she wouldn’t regret later. This is the step-by-step guide I shared with her.
Step 1: Do you even need to make this decision?
Very often, confusion and indecisiveness come from not knowing why we’re making a decision in the first place.
For example, we recently bought a house in a new subdivision. All the houses come with unfinished basements. Whenever I talk to neighbours, they ask when (not if) we’re going to finish ours.
We could easily be peer-pressured into starting this basement project. However, without a clear reason, every decision along the way would be painful.
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How many rooms should we build?
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What floors should we install?
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What colour should we paint the walls?
Because we don’t have a strong “why” for finishing the basement, all of these choices would feel heavy and forced. Every trip to Home Depot would end with frustration.
So before you go any further, ask:
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Do I truly need to make this decision?
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Or am I only making it because everyone around me is?
Good decision making often starts with not making unnecessary decisions.
Step 2: What is it for? Define your core selection criterion
Next, ask yourself: What is this decision for?
Why do you need this thing or this result? What fundamental purpose is it serving?
When you are clear on the purpose, you can define a single core selection criterion.
Sometimes the main criterion is:
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price
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aesthetics
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comfort
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ease of use
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status or prestige
It all depends on why you’re trying to buy this item or reach this result.
You cannot chase all of these at once. Therefore, pick one main criterion for your decision making. As soon as you do that, most options will drop off the list automatically, which makes the process much easier.
Step 3: Set a deadline for making the decision
There is no better feeling than finally deciding. It’s like taking a heavy backpack off your shoulders.
So why prolong the agony?
Personally, I often set Friday as my deadline for major decisions. I don’t want my weekend hijacked by analysis paralysis. I want to enter Saturday with a clear mind.
Don’t give yourself too much time. Beyond a certain point, extra time rarely adds extra clarity. It just adds more overthinking.
Step 4: Separate facts from fiction
Now, grab a piece of paper and divide it into two columns:
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Facts
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Fiction
First, list the facts of the situation. Facts are things you could prove in court with neutral data.
Then, list the fiction. That’s the story you’re telling yourself—your fears, assumptions, and judgments.
For example, let’s say you are deciding whether to move.
Facts:
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“I can’t afford this place at my current income without sacrificing my other financial goals.”
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“It takes me one hour to commute to work each way.”
Fiction:
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“I’m such a failure for not being able to afford this place.”
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“I should be making more money by now.”
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“Moving is impossible.”
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“I hate packing more than anything.”
You can feel the difference immediately, right?
When it comes to decision making, focus on the facts and ignore the fiction. Fiction will change with the weather, your mood, or whatever you saw on the news this morning. Facts stay the same.
Once you start using Agile principles for your goals, this becomes easier. A decision based on facts becomes just another sprint goal to move to “done”. There is no drama—just a clear definition of done and daily progress.
Step 5: Consider the cost per use
When you’re making a purchasing decision, always ask:
How often will I actually use this?
My personal spending philosophy is simple:
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Spend more on items you use every day.
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Spend less (or borrow/rent) for things you’ll use once or twice.
For example, I’m okay spending over $1000 on a Miele coffee machine that we use 5–7 times a day. On the other hand, I rarely spend more than $100 on a dress for someone’s wedding. Most of the time, I find something beautiful at a thrift store for $20–30 and still get compliments.
Good decision making always looks at cost per use, not just the price tag.
Step 6: Are you choosing out of fear or love?
Mark Manson talks about the “Fuck Yes or No” rule in dating, but you can apply a similar idea to decision making in general.
Ask yourself:
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Am I making this decision out of fear?
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Or am I making it out of love?
Most impulse purchases—especially sale purchases—are driven by fear:
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Fear of missing out on a deal
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Fear that the good price will never come back
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Fear that this is the only chance
However, think about the last sale purchase you loved. Most likely, you already wanted that item before you saw it on sale. In that case, the decision came from genuine desire, not fear.
The fastest way to regret a decision is to make it from fear, not from love.
Step 7: Make the decision after the decision
Here is the truth: you can make a perfectly good decision and then torture yourself for years by second-guessing it.
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Did we buy the right house?
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Did I marry the right person?
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Did I say the right thing?
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Did I edit this blog post enough?
The most important decision is actually the decision after the decision.
At some point, you have to decide:
“I made the best choice I could with the information I had, and I’m backing myself.”
Then you move on.
Your marriage doesn’t really begin at the wedding. It begins the next morning when you wake up and decide again that you did make the right choice.
Step 8: Maximize the half-life of your decisions
As we get older, we have to make more and more decisions. Inevitably, that leads to decision fatigue.
In grad school, I learned about the concept of half-life in biochemistry:
Half-life (symbol t½) is the time required for a quantity (of substance) to reduce to half of its initial value.
Source: Wikipedia
I think it’s a brilliant idea to borrow for decision making.
Whenever possible, you want to extend the half-life of your decisions—in other words, make decisions that last longer so you don’t have to remake them constantly.
For example:
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Cleaning the bathroom yourself has a short half-life. You’ll be deciding again next week.
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Hiring a cleaner has a long half-life. You decide once and benefit for months or years.
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Deciding what to eat for your next meal has a short half-life. Creating a monthly meal plan has a longer one. Hiring a meal prep service extends it even further.
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Buying an investment property tends to be a longer-term decision than picking a new crypto coin every two weeks.
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Committing to a long-term relationship is a long half-life decision. Having a one-night stand is a short half-life decision.
In my experience, good strategic decisions generally have a long half-life.
Step 9: Consider second-order consequences
Now we’re entering deeper strategic territory.
Many of the problems people face come from decisions that ignored second-order consequences.
First-order consequences are what happens immediately.
Second-order consequences are what happens because of that, later.
For instance:
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Subscribing to Netflix gives you something fun to watch at night (first-order). However, it also makes it easier to avoid walks, hobbies, or deeper conversations (second-order).
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Buying new plant pots feels exciting in the moment (first-order), but it also adds a three-hour repotting project to your to-do list (second-order).
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Aggressively negotiating for the lowest price may save a bit of money now (first-order), yet it can damage your reputation and future service quality (second-order).
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Signing up for a new social media platform may feel fun at first (first-order), but constant notifications can slowly destroy your focus (second-order).
A very useful question for decision making is:
“Will this decision create more to-dos for me later?”
If the answer is yes, think twice. It’s one of the easiest money- and time-saving filters you can use.
Create your own decision-making framework
Creating a decision-making framework is a surprisingly powerful thought exercise with a very long half-life. You build it once, then reuse it for years.
To start:
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Look back at the most impactful decisions you’ve made.
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Ask: What do all the good decisions have in common?
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And: What do the bad ones have in common?
You’ll quickly see patterns you can turn into your own rules.
If you want a clear, step-by-step system for making and executing decisions the Agile way, I can guide you through your first sprint.
