Recently, I had the pleasure of reading Tyler Cowen’s excellent book The Complacent Class: The Self-Defeating Quest for the American Dream. In it, Cowen makes the argument that in achieving the relative stability that America has enjoyed since the 1970s, we’ve become complacent and mostly just seek to preserve that sense of stability, but that the elements that have made America great have come from periods of instability – World War II, for instance, and the cultural upheavals of the 1960s – and thus our efforts to conserve that stability are actually making America less adept at change and innovation, which enables other nations to catch up to and surpass us. He makes a great argument for that idea, and regardless of whether you agree, it’s powerful food for thought.
I’m bringing up The Complacent Class because there was one particular quote that really stood out to me as one that was very meaningful in terms of the ongoing quest for financial stability and independence that many of us find ourselves on. Here it is, found on page 124:
“So many of us now have seen or tried or maybe just read about “the best” that we either learn to be content with the matches we can achieve or we are perpetually discontented.”
So, let’s back up for a second and talk about what he means by “matches.”
Cowen’s argument is that one of the most powerful changes in America over the last thirty years or so is an increase in the breadth of “matches” we can achieve in our lives. Matches, in this sense, refer to any option among an array of options that we might choose for our lives. You make a match when you choose to date someone, for example. You make a match when you select a type of soap to buy.
Over the last twenty to thirty years, our ability to find matches has exploded for a number of reasons. The availability of online shopping is obviously one big factor, but our knowledge and awareness that so many more options even exist is another part of the equation.
There was a time, for example, where the dating options for most people consisted of the people in their town or perhaps in neighboring towns. Most people did not attend college and eventually chose jobs in their local town, so meeting people from far away was difficult. Your overall dating pool was much smaller, so you had far fewer potential romantic “matches.”
There was a time not too long ago when your only options for buying mustard were the two or three options stocked on the shelves of your local grocery store. You might buy one and if you liked it, you’d probably stick to it. Most people weren’t even aware that there were more options out there or, if they were aware, they recognized that the difficulty of acquiring that strange mustard was prohibitively difficult and thus made it a pretty poor “match.”
You can see where this is going. The cultural changes over the last fifty or so years have enabled a rapid expansion of dating pools and also the ability to compare people in your dating pool to people outside of that potential pool (via the media). People no longer feel that they have to choose a mate out of the 100 or so people of their approximate age in their area; the pool is now much larger for almost everyone and nearly infinite for some.
The same is true for mustards. Most grocery stores stock a lot of kinds of mustard now and you can easily find many, many more mustards online. You can get almost any variety of mustard imaginable.
This same phenomenon is true for everything. We simply have far better “matches” available to us in every dimension of our lives due to better access to products and better access to information.
So what’s the problem?
Well, there are a number of them, actually, and they have a huge impact on our financial and professional decision making and outcomes.
The Paradox of Choice
The first problem is described very well in Barry Schwartz’s excellent book The Paradox of Choice; you can get a summary of Schwartz’s point in this excellent short talk by him.
Schwartz argues that when the number of choices available to us for a particular decision is too large, we tend to struggle mightily and often end up making poor choices.
The reason is that when you start increasing the number of choices available to you, it takes more and more mental effort to dig through all of those choices.
Because of all of that additional mental effort, we often begin to rely on simple signals to tell us what the best option is for many decisions, and one of those simple signals that we rely on is price. If you’re looking at a bunch of mustards at the store and you want to get a good mustard, one mental shortcut that many of us use is to eliminate the cheapest ones because they’re theoretically not very good. The expensive ones must be better.
Why do we do this? We need to have something to cut through the options and help us find the best one. The problem is that knowing how to cut through the options with all of the different kinds of decisions we face every day is essentially impossible. It would require a ton of knowledge, far beyond what is reasonable for an average person to understand. A mustard manufacturer or mustard seed farmer might have some great domain knowledge that can help them pick “the best” mustard, but us? Is it really worth the effort learning a lot about mustard to choose the “best” mustard? Probably not.
You can repeat all of this for almost anything in the world – mustard is an example. The same thing is true for ketchup or toilet paper or pickles or dating options and so on.
The most interesting thing is that we often end up feeling that we could have made a better choice and we end up feeling less happy with the option we chose, even though we have so many choices. In all of those unchosen options, there must have been a better one, right? Thus, we regret the option that we chose. We regret that bottle of mustard. Maybe we even regret our spouse.
We also often suffer an escalation of expectation, meaning that if there are two kinds of mustard, we have lower expectations out of whatever one we choose than if we had 100 kinds of mustard to choose from. If you only have two kinds of mustard, it’s unrealistic to think either one is perfect, but if you have 100? Well, then, one of them must be perfect or pretty close to it! (We’ll get back to this in a minute.) It means disappointment and regret and second-guessing are incredibly easy and pleasant surprises are harder and harder to come by. It also means that when you feel that dissatisfaction, you blame yourself because surely it must be your fault that you didn’t make the best choice!
Even worse, people often avoid making larger choices when they’re overwhelmed with options. Schwartz uses a great example of this in the video, pointing out that when more investment choices are offered in a retirement plan, people actually are less likely to participate even if the employer is offering matching funds. This may explain things like declining marriage rates as well.
Here’s the truth: some choice is better than no choice, but there quickly comes a point where more choices are actually a negative rather than a positive. They end up costing us more money and leave us feeling regret.
Does this seem bad? Well, we’re just getting warmed up!
The Perfect Is the Enemy of the Good
One of the biggest problems in all of this is that, even if you find the absolute best mustard in the market, the actual quality difference between that mustard and one of your first options is relatively small.
In other words, it’s pretty easy to find options that are “good enough” – in other words, that are of 90% or 95% quality – but it becomes prohibitively difficult to find the one that’s “perfect” – the 100% option.
It takes just a little effort to get to one of the best options. It takes a ton of additional effort to get to the best option. (Of course, best is however you define it – best bang for the buck, best product quality, etc.)
Yet, as we saw above, this idea that we didn’t quite reach “the best” lingers over our heads, creating dissatisfaction when there otherwise wouldn’t have been any. We put in more and more and more effort for smaller and smaller and smaller benefit, and yet that dissatisfaction that we don’t have quite the best never really goes away.
There’s always better mustard. Or better pens. Or better dating partners. Or better anything.
If the options are few, we can actually evaluate each option and reasonably choose among them, feeling confident that we did choose the best among our options. When the options are many, we can never be quite sure we’ve chosen the “perfect” option
The idea that a “perfect” option is available to us is always the enemy of actually having a “good enough” option. It brings us down, and it gets worse when there are lots of options available to us.
How to Solve the Conflict Between “The Best” and “Good Enough”
So, how do you resolve that conflict? In a world where we have tons of options, how do you resolve that conflict between “the best” option and simply having a “good enough” option? In other words, how do we find happiness in the 90% option?
Here are five strategies for finding happiness in “good enough” rather than despair of possibly coming just short of “the best.”
Reflect
This is the single most valuable tool that everyone has in their arsenal when it comes to being at peace with your purchasing decisions. I find that, again and again, the more I reflect on my purchasing decisions, the better I tend to do with them, even if I’m not choosing the “perfect” option.
What I reflect on is this: how much of life am I missing out on chasing some sort of “perfect” result? My wife isn’t “perfect” and she would say the thing about me, but if I had waited for “perfect,” I would not have an absolutely wonderful marriage.
My retirement investments probably aren’t “perfect,” but if I had waited around for “perfect,” I wouldn’t have much saved for retirement anyway and even the best investment in the world can’t dig you out of the hole that time puts you in.
If I spend a lot of time stewing over the perfect mustard, finally choose one, and then end up deciding that I might have bought an even better one, wouldn’t I have been better off just grabbing a good mustard quickly and enjoying my sandwich without really worrying whether the mustard was optimal? “Really good” mustard can be found quickly and isn’t far off of “perfect” mustard, after all.
If you find that you’re making a decision in life that you regret, reflect on the alternative solutions. Would you really be happy spending that much more time finding a “perfect” solution? Even if you have found a somewhat better solution, is it that much better? And wouldn’t you have missed out on things had you waited around for this “better” solution to come along?
Make a List
Another factor that often plays into that battle between “the best” and “good enough” is that I’m convinced I need to worry about factors that aren’t even really relevant to me until some marketing guru convinces me that I need to worry about it. If you’re trying to make a decision between a bunch of options, just list in your head what factors you actually care about as you’re looking and pick one that checks as many of those boxes as possible, then just walk away.
In other words, boil things down to the features that you care about, look at the options through just that filter, and make a choice accordingly. It’s a lot easier to make a decision based on just a few criteria that you’ve conceived of yourself and you’re far more likely to end up choosing something that you’re happy with.
Stop at Three (or at Absolute Most Five) Viable Options
When we’re looking at a wide variety of options, like when we’re choosing a salad dressing in the store, it’s easy to get lost in the wide array of options. You’ll decide on one, then maybe switch that decision to another one, then you find yourself torn between several options, and even when you pick one, you’re not really happy that you picked a good one.
Do this instead: grab the first three or so options that you see that look good, toss them in your cart, and walk away from the salad dressings. When you’re on the other side of the store, decide which one you actually want among the ones you’ve grabbed, then simply return the other two.
What this does is that it artificially limits your choices down to a small set so that you can make a reasonable choice among the options. You’re not trying to find the best among 100 options, most of which aren’t that good; instead, you’re just choosing among three options that are pretty good.
Seriously, try this – it works really well. When you’re facing a wall of hot sauces or laundry detergent, rather than evaluating fifty options, grab three that seem good and walk away. When you’re far away, choose one among those three and put the other two back. You’ll find that you have a pretty good option that you’re happy with almost every time. You’d be shocked how often I do this when I wind up with a last minute vague item on my grocery list (like “coffee”).
Trust Independent Sources
The reason that we often think that we don’t have the “best” option is because we’ve been informed that someone else has the opinion that we don’t have the best option. We hear some marketer who tells us that some other option is better, or we see some magazine that describes the “perfect” mate that our current partner doesn’t live up to.
The real problem here is that those sources aren’t necessarily trustworthy. They’re often written by marketers or other people whose primary purpose is not to point us toward the best option, but to convince us to buy something. Maybe they’re just not particularly informed about the options that are available.
What really matters are trusted sources. There are only a few sources of information on products that I really, deeply trust. One is Consumer Reports. Another is Cooks Illustrated. When I need a product recommendation, I virtually always find that their “best buy” picks or “bang for the buck” picks are perfect for what I want. Often, I just follow those picks without digging any deeper unless I am deeply concerned about a particular feature.
Find a handful of independent sources that you trust regarding decisions that trouble you and just trust their conclusions. In other words, offload the pressure of a buying decision to them and just follow their suggestions.
Stick with Consistent Choices That Work
If you have a product that you know fulfills your needs well, stick with that product. Rather than being overwhelmed with tons of other options, stick with the one that actually fulfills your needs. Grab that one and move on with life.
Might there someday be a better product of that type? Sure. Here’s the thing, though: leave the work of figuring out whether new products actually are better to those independent sources that you trust. Don’t waste your personal time or energy or money on new options that are at least as likely to be disappointing as they are to be worthwhile. If your trusted source ends up concluding it’s better, go with the new one; otherwise, stick with what works.
This policy serves the purpose of ensuring you always have an item that solves the problem you want it to solve while also making sure you don’t throw money after products that may have uncertain results.
I do this with many regular purchases; I stick with some store brands and some Consumer Reports “best buy” options until either that item isn’t available any more or I happen to read an updated article from CR. That way, I don’t get trapped in the decision process of having to decide if a new option is worthy of a purchase. I quickly grab the item that works and move on with life.
Trim Your Media Consumption
Many of the problems with feeling regret about purchases or desire for higher-end options that don’t really meet your needs comes from media sources. Newspapers, websites, blogs, magazines, television shows – all of them seem to devote significant time to the latest and best and greatest products, encouraging us to not be satisfied with our current choice or the current options available to us. There’s always some new product or some exclusive thing that we must try.
The easiest way to combat that sensation of not being satisfied with your current choice when it meets your current needs and desires is to simply cut back on your consumption of those kinds of media. Trim your intake of newspapers and websites and blogs and magazines and television shows that encourage you to consider new products and chase consumer goods. Instead, devote your time to media sources that aren’t all about the latest and greatest stuff, that don’t fill you with ideas that what you have now isn’t good enough and that you really don’t have the best option.
That news isn’t really informative, because it doesn’t really address the fact that some particular area of your life is already fulfilled pretty well. It just encourages you to want to spend your money on something that the media writer wants you to think is even better, which leaves you with nothing more than dissatisfaction with what you currently have and a sense that you ought to have something more, even when that “something more” might not really be much of an improvement for you after all. It’s that sense of dissatisfaction with your current choice that drives a lot of consumer unhappiness and it also drives people to spend even more on stuff.
Final Thoughts
With the enormous multitude of choices before us, it is very easy to get trapped in the desire to find the best option – and it’s equally easy to get lost in a sense that you haven’t actually found the best option and somehow you failed, especially when you invest significant time and effort into making a choice.
The way around it is to make choices completely on your own terms. Think about it in advance, assess your needs, restrict your actual choices tightly, stick with things that work well, and keep from spending your entertainment time on things that just make you feel bad about your choices.
It’s not a perfect set of solutions, but most of the time, you’ll spend less time dithering on choices and feeling like you’ve made a mistake and more time actually enjoying the “good enough” option that you chose and feeling great about it.
Good luck!
The post Seeking “The Best” Versus “Good Enough” appeared first on The Simple Dollar.
Source The Simple Dollar http://ift.tt/2p1kZqE
