Updated on 12.08.07

Facing A Difficult Personal Finance Decision (Or Other Major Decision)? Try These Seven Techniques

Trent Hamm

As I mentioned a while back, I’m in the midst of making a pretty significant life decision: do I make the leap to being a writer, or do I keep doing things as I currently am? I’m turning the whole matter over very slowly and analyzing from a lot of different angles.

Since I’m taking this decision so slowly, I’m trying a wide assortment of different techniques for making my decision to see where they point me. Here are the ones I’ve tried that have provided some revelations to me.

Make a giant list of pros and cons I shared the highlights of this list earlier, but since then I’ve kept it around, growing both the pros and cons of the decision to almost absurd lengths and often rewriting and clarifying specific points.

This constant revision has started really breaking the decision down into the true pros and cons of the situation. In truth, the pros are about what my heart wants and the cons are about what my mind understands. On paper, I shouldn’t even consider making this move. In my heart, though, I have a sense that if I don’t do it now, when the pump is relatively primed, I never will.

Prioritize your options The Prioritizer, a tool to which I wrote a passionate ode a while back, does a very good job of helping you rank a list of items based on your personal priority. I disassembled the various pieces of the puzzle (children, intellectual curiosity, etc.) and ranked them using the tool.

I found out that my children are my highest priority, which is a vague indicator that I should play the safer route as it provides a greater security net for them. What I did find, though, is that control and freedom over my work are things that I value very highly – I don’t like work where I have limited control over what I’m doing and what I’m producing.

Call a trusted friend for a long, heartfelt talk Often, there are aspects of your situation that are intrinsically tied to who you are as a person. As a result, there is significant added value in talking to someone who knows who you are and can include things like your personality and a more detached view of your skills and talents into account, things that you can’t judge accurately for yourself.

Once you’ve initiated the conversation, lay it all on the table – everything you’re thinking both ways on the issue. Hopefully, you’re talking to a friend close enough to you to provide their most honest assessment of the situation, even if it might not be the one that you want to hear.

Look at the “big three” scenarios Sketch out in as much detail as possible the best case scenario, the worst case scenario, and the average scenario that would result from making the decision that you’re debating. The best case scenario reveals the things that compel you the most, the worst case reveals the things that worry you the most, and the average case indicates your authentic hopes for what will happen.

The more you detail those scenarios, the better your understanding of the actual dilemma becomes because you begin to actually see the secondary and tertiary effects of that decision on your life. Quite often, these secondary and tertiary effects are the ones that make or break your plans. For me, I’ve found these secondary and tertiary effects to be quite fascinating. Would this move make me less social? Would it improve my children’s intellectual development? Interesting issues to think about.

Collect advice from as many sources as you can While it may not have the value of a deep conversation with a trusted friend, running a two minute drill of your dilemma past a lot of people can provide a lot of insight. Submitting your concern to a large group can reveal countless angles that you never considered and it can stress certain areas that you glossed over before.

By merely writing about my decision on this blog, I threw my dilemma out there to 100,000 eyeballs – and I collected a lot of advice from a lot of people. I’ve also threw the dilemma out there to almost everyone in my life to see what they thought about it – and collected their ideas, too. What does all of this data mean? It’s a serious gut check – in my case, the biggest one was about the quality of my writing, something which underlies all of my plans. People are very honest about their concerns, often revealing angles that I never even conceived of on my own.

Tuck it away for a while Many major decisions, like this one, don’t have to be made immediately. You can gather information, then tuck the information away in your subconscious mind to work slowly over time. This is actually the place I’m at now with my decision – I’ve postponed further thinking and deliberation for a month to let it all settle and allow my subconscious mind to work away at it for a while.

This has been very beneficial to me many times in the past. I basically stopped deliberating my choice about college (I had a handful of strong options) for a month and let the choices settle in my mind. When I picked up the decision again, the right answer revealed itself very clearly and quickly.

Take the road less traveled In the end, one big piece of the puzzle that keeps most of us from making the move that we feel is right is a fear that it’s not the socially acceptable thing to do. Lately, I’ve been thinking aboutgroupthink” quite a lot and I’ve come to the conclusion that quite often it prevents you from making the best decision.

My conclusion? Don’t worry about what “society” might think of your choice. Quite often, they point towards a path of conformity in some fashion or another. While conformity might help people get along in social situations, it’s rarely a healthy indicator of how you should live your life. Discard those worries and take the road less traveled.

I shall be telling this with a sigh
Somewhere ages and ages hence:
Two roads diverged in a wood, and I –
I took the one less traveled by,
And that has made all the difference.
– Robert Frost, “The Road Not Taken”

Loading Disqus Comments ...
Loading Facebook Comments ...
  1. southerngirl says:

    I actually really like this article; I’m a very big believer in seeking advice from everyone and, probably most importantly, sleeping on it.

    But the English major in me really dislikes the common perception that “The Road Not Taken” is a hymn to originality and striking out in new directions – an uplifing urge to be an individualist, so to speak, and largely because that’s the section that everyone always quotes, the lines from the end.

    I know that’s how everyone chooses to interpret it, probably because it makes them feel bold or happy or what have you, but in large part the rest of the poem, and many of Frost’s other works as well are very dark and sad, the language is VERY ambiguous – and it’s worth noting that sometimes the “and that has made all the difference” sentiment can be a terrible thing, as well as a great one.

    There endeth my supergeek freakout. :)

  2. Laura says:

    Great timing on this. I’m facing this right now with my career choice. I have a stable job with good pay near my area, but I’m not happy. The cost of living is high where I’m living now, so this job is needed to be able to save something. I would like to seek employment in a different area where the cost of housing is less, but I have few contacts there right now. It’s something I’ve been discussing with my husband for some months.

  3. Ron says:

    Remember: There is wisdom in a multitude of counselors. The more points of view you can consider, the better your decisions will be. Of course, it goes without saying that you only use competent counselors.

  4. Is it possible for you to not have to choose one but continue to straddle and multi-task all of your paths at once?

  5. Michael says:

    One technique that has helped me when deciding whether or not to do something is to decide from the other direction.

    For instance, if you are trying to decide whether you should sell your car and get a cheaper one to get out of debt, look at it from the other way. If you had the cheaper car, would you go into debt to get the more expensive car?

    Basically, the idea is that if you can’t decide to go to B from A, if you were at B would you go back to A. If you would move to B, then B is better and is the one to go to.

    I know this practice can make a problem that seems like a toss-up appear much more clear.

  6. Are you in a position that would allow you to slowly ease into it, or would that ensure that you failed at both (current job and your dream)? By definition, life’s decisions are never easy.

    Best Wishes,

  7. plonkee says:

    I am also a fan of getting as many different points of view as is practical, and not thinking about it for a bit.

    As with any big decision, once it’s made, you can make your life work regardless of which choice you made.

  8. guinness416 says:

    In my experience “society”, or “people” just do not care about our decisions, whatever we might think. They’re just not important to anyone but yourself and your immediate family.

  9. Becky says:

    I really like your last point, about taking the road less traveled. My new husband and I did this with our wedding and it was the best thing we ever did! Everyone thought we were crazy for planning a wedding in two months (no, I’m not pregnant) and we did a small wedding on a Sunday with no big “dance” reception. Bucking the trend was not popular with a lot of people, but it fit who we are and made the day sooooo much more enjoyable to us than if we had had the kind of wedding that society told us we should have.

  10. JReed says:

    I use a “decision tree” to make big decisions. It plots out most of the possibilities and the outcomes using “if”, “then”. Usually there are only so many outcomes that I am willing to accept so once it is drawn out, the path to these results become clear.
    I was taught this tool in high school and never forgot it. Later I was reading a drug instruction pamphlet meant for physicians and realized it used the same technique.

  11. Ryan S. says:

    This is a perfect article for me right now, as I’m facing several important personal and professional choices. I don’t have to decide right now, but some of them I must decide soon, some I’ve decided must be decided upon before the end of 2008. Thanks a lot!

  12. Sunshine says:



    Your point is well noted, but w/o getting into the nuances of english lit, (esp. coming from my science background and history of hating every lecture or assignment that involved any sort of analyzing any sort of literature for its ‘true’ meaning), perhaps the poem is intended to be ambiguous, so as to be interpreted by the reader how they see fit. I have chosen to interpret it the way Trent has for many, many years even while knowing the entire peom.

  13. Sunshine says:

    Oh, BTW, Trent – Great post!

  14. Shevy says:

    I’ve always really liked The Road Less Traveled but it’s *very* ambiguous. When I studied it in high school I came away with the understanding that the core of the poem was about choice and the various subsequent choices that spin off from the initial decision. (See the portion I’ve chosen to quote below.)

    The end result may be good or bad, but you’re unlikely to be able to go back and start over so you should take your time and choose carefully or you may be looking back with regret at the end.

    Possibly that’s the part that most closely connects with the decision Trent is facing right now and the importance of this decision on what will come after for him.

    “Oh, I kept the first for another day!
    Yet knowing how way leads on to way,
    I doubted if I should ever come back.”
    Robert Frost

  15. You should go for the career in writing. It’s not as hard as you may think, especially if you’re willing to write about things you’re not interested in. Every company needs writing (for brochures or their website) and every magazine (even boring trade mags) need articles. I highly recommend making the change if it will make you happy.

    – hereverycentcounts
    (freelance writer/designer)

  16. Trent – your last point is right on. When I left the 2-year analyst program at an investment bank a little over 10 months after entering it, everyone thought I was crazy. I was 2 months away from a hefty year-end bonus, but I was completely miserable. A lot of people tried to convince me that no one ever leaves the program (sounds like a bad sci-fi movie plot). But these were the same people who were just as miserable as I was, unwilling to make a change because no one else had before. Ultimately, it won’t matter what other people think about your unconventional choices. If you make a choice with good consequences, then you’ll be happy. If you make a choice with bad consequences, then you’ve got more to worry about than what other people think.

    Best of luck!

  17. Echo says:

    This is a great article. You did leave off one of my own personal tools, so I thought I would comment in case it was something you wanted to add to your list. I believe that there is a higher part of ourselves/the universe/God that knows how every decision is going to turn out. Whether someone uses prayer or meditation or intuition, or whatever they want to call it, that part is wiser than us and knows the ultimate truth about what the best decision is. I try to access that in addition to consulting my thinking and emotional selves when making a decision.

  18. Mohammed (UAE) says:

    There is a nice little tool (called EvaluWeight) available for free which seems to be a good way to do this (without having to make up a spreadsheet).


    You identify and weight different factors and then rate different products against those factors.

    The author of the software notes that usually the decision depends at most 20% on financial aspects. I think there are more “parts” to the finance, not just the purchase cost. How about upkeep, maintenance, insurance etc.

  19. Penny says:

    Trent, I tend to agree with Echo some things just take on a life of their own. They are meant to be, or not. You are already writing, but you want to make money at it. So many of the post make sense. Why can’t you do it all! Not to the degree of the hurried rabbit but like the slow and determined turtle that finished the race. I would write your novel or self help book and send it out. All the pros and cons won’t get the writing finished. My opinion is not to quit your day job. When you get a bite let it take on (as I hear writers say) a life of it’s own. As I have been reading your emails everyday I notice something very important. If you put everything you know into the best ideas you have learned, someone would see the potential for greatness. I have learned from you about many things. What if you took it all and gave a concice and practical way to look at life. I’m not a fan of ambigous thought on paper. I like knowing someone has an opinion and shares it. Also December is a bad month to start anything, I expect when January rolls around you will be up and running with new ideas. That is my prayer for you.

  20. Steve says:

    Trent, I think you should keep your day job, but I think you already know that. What is The Simple Dollar about? If it’s about sense and cents, the decision is pretty clear. Like any other business that is grown, whether it’s writing, or selling things through ebay, or maintaining a website with revenue, the time to quit is when you’ve got enough secondary income to meet your goals. Do you have a solid plan to achieve that through writing? What parts of that plan could be executed while keeping your day job?

    As you know, personal finance is all about looking at the picture critically, with an eye for what’s actually likely to happen, rather than what you want to happen. People get in trouble because they assume the best case scenario – because they let what they want prevent them from seeing what is.

    Applying the words of Dave Ramsey to your current dilemma, get rich slowly: be measured and pragmatic, don’t jump in.

    If you want to make money, what’s the business model? Does this blog have a business model? Is it a marketing tool for a book, or something to raise your web presence in preparation for capitalizing on it? Make sure you’re spending your considerable energies on things that lead to income.

    At any rate, that’s my two cents – my wife and I really enjoy your blog!

  21. Leisureguy says:

    I highly recommend the book Decision Traps, by Russo and Schoemaker, for any time that you’re facing any major decisions. We are all self-taught decision-makers and thus we all are prone to common errors. This book reviews the ten most common errors—with examples—and shows how to avoid them and how to improve your decision-making.

  22. vh says:

    Follow your heart. You will make the right decision.

    One thing is for certain: If you try to go it on your own and it doesn’t work, your world will not end. You’re now financially stable, you have a spouse who can pick up a job that will cover your family’s health insurance, you evidently have made a social life locally that provides friends and business contacts, and so you can get another job if you have to.

  23. Kim says:

    These kinds of decisions can be heart-wrenching, I know.

    But ……… aren’t we who have choices so very very lucky?

  24. Mike says:

    Wow! Great reminder, Kim. And a great post, Trent. How wonderful to have financial choices in a world where each day is a struggle just to survive for so many people.
    I think Frost’s poem is bittersweet, but in a good way, in the same tone as the last line from John Updike’s “A&P”: “my stomach kind of fell as I felt how hard the world was going to be to me hereafter.”
    The best choice is not always the easiest choice–sometimes it’s the hardest road–but it’s the road you’ve chosen and therefore it’s the path that’s truest to who you are.

  25. Red Jello says:

    The last one is: go with your gut. Many times I just knew it was the right decision, even if I couldn’t articulate it. Intuition and gut tell all!

  26. Louise says:

    That poem makes me gag in the same way that seeing “What a long strange trip it’s been” in a high school yearbook does.

    Otherwise a very helpful guide. Thanks.

  27. partgypsy says:

    One thing I do have to say, is that you are an excellent writer. You are able to take a complex topic and break it down into parts that are easy to understand and even enjoyable to read. I think you would be great at how to or self help type books. I guess I would go with money blue book and Steve’s advice. You do have a career in writing (along with your other careers) but it is not fully self-supporting. If you did it full time, what would you be doing differently than what you are doing right now (and I don’t mean I will work x many more hours at it, what would you do qualitatively different?)

  28. Jude says:

    I used a similar process in deciding whether to go to grad school, get a job, or do something for a few years like teaching abroad or the peace corps. After coming to the conclusion that grad school is where I want to be, it has been full steam ahead taking the GMAT and applying (with all the headaches that come with it)

Leave a Reply

Your email address will not be published. Required fields are marked *