Paycheck Chronicles

Reviewing The Past To Make Better Decisions In The Future

Life is like one big choose your own adventure book.  Every day, we're all faced with a ton of choices, and many of those choices impact things in the future.  This is not news to anyone - we all know it - but sometimes it is easy to forget.  Or sometimes we want to forget.  Either way, it's pretty common to try to mentally erase the connection between past choices and current situations.   That's not ideal.

Most of the time, it's better to actively try to see how things you did in the past impact your life today.  Retrospection, the action of looking back on or reviewing past events or situations, especially those in one's own life, is an important tool for making better decisions in the future.   Henry Ford is quoted as saying, “The only real mistake is the one from which we learn nothing.” This is true for life in general, and it is true for financial issues.  Identifying and thinking about places you've made smart or dumb decisions about money will help you make smarter choices  in the future.

Why You Avoid Looking Back

This is sort of a dumb question, but it still merits taking the time to consider.  Why do you avoid thinking about bad decisions that you've made in the past?  There could be lots of reasons:  regret, embarrassment, frustration, shame, and denial are just a few.  Most people like to avoid negative feelings, and looking at mistakes can bring up a whole lot of negative feelings.

How To Make It Easier

There are three main ways to avoid the negative feelings that can come with reviewing your past decisions.

First, try to remove the emotion.  This can be extremely hard.  It may help to write it down while you're thinking about it, so that more of your brain is engaged and less of your brain has the capacity to wander off into emotional territory.  Another strategy is to think of the situation as if it isn't you, but a stranger that you're watching, like in a movie.

Second, remember that everyone fails, and everyone makes mistakes.   Thomas Edison said, "I have not failed.  I've found 10,000 ways that won't work."

Third, focus on the future.  Remember the purpose in reviewing your past decisions:  making better ones in the future.  Thinking only about how you can use this information in the future is a great way to avoid the emotional baggage that can come along.

Keeping mistakes in the past is an easy way to avoid negative feelings, but it's a terrible way to learn and improve.  Facing your decisions, and the outcomes, it a powerful tool for better outcomes in the future.


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