It’s funny how we often fear taking big chances that fester in the back of our minds forever. In the long-run though, our biggest regrets are not having taken those very chances.
Let’s say in the first scenario you own stocks in Company A and sold them to buy stocks of company B. In one year, Company A outperformed Company B and you lost Rs 100,000. In the second scenario, you own stocks in Company C and chose not to switch to Company D. In the resulting year, company D does better, and you missed a chance to earn Rs 100,000. Which error would cause you more regret?
Studies show that 9 out of 10 people would say that scenario 1, where they changed the status-quo to lose money would cause them more regret. But the psychologist Dan Gilbert explains how they are wrong in feeling that way due to how we feel about chances in prospect and in retrospect.
When people are asked about chances that lie ahead of them – of starting a business or of doing the unconventional, they hesitate to take the plunge. This is because in prospect, the fear and the pain of failure seem quite unbearable. Nobody who starts a new venture thinks of failure as pleasant or useful. No bride or bridegroom would agree that being left at the altar before it happens would have a positive effect on their lives. No healthy person would see the bright side of being diagnosed with a terminal illness.
In retrospect, however, things could not be more different. Several founders have “favourite failures” – ventures that did not take off, but taught them valuable lessons. Several people who have been left at the altar call it the best thing that has happened to them. Even people diagnosed with terminal illness often receive new perspective that boosts their happiness. After an event, our minds are great at looking at the bright side of things regardless of how bleak they seem before they happen.
Even though it feels strange, taking a chance is likely to make us happier than not taking one. This is because the mind can only rationalize the decisions we make – not the ones we do not. When we decide to start a new company and it fails, our minds can come to terms with it after it happens. However, our minds cannot rationalize the hesitation to found a company. They only end up regretting it in the long run.
It pays to take the plunge even if the risk of failure seems daunting or unbearable. As Seneca, the Greek philosopher said, “We suffer more often in imagination than in reality.”
Inspiration: Stumbling on Happiness – Dan Gilbert