Avoiding common biases and mistakes is essential for making rational decisions, especially in investing or critical thinking. Cognitive biases, like confirmation bias—favoring information that aligns with our beliefs—and recency bias—giving undue weight to recent events—can cloud judgment.
Overconfidence is another pitfall, often leading to high-risk choices. To counteract these, it’s helpful to actively seek diverse perspectives, challenge initial assumptions, and practice patience rather than impulsivity.
Keeping long-term goals in focus and using checklists for decisions can also help minimize errors. By recognizing and addressing biases, you build a more objective and balanced approach to decisions.