Jean Surette

12 Biases that distort your Decision-Making: 1. Confirmation Bias - We interpret new information as confirmation of our existing beliefs. 2. Availability Bias - We tend to rely on information that comes to our mind easily/the quickest. 3. Action Bias - We favor action over inaction. That's why we sell or buy prematurely. 4. Zero-Risk Bias - If a risk is considered small, we assume there is no risk at all. 5. Overconfidence - We overestimate our own knowledge and ability. Often because we know too little to know better. (Less knowledge => more confidence) 6. Survivorship Bias - This is a sample bias that occurs when we assess only successful outcomes and disregard failures. 7. Gambler’s Fallacy - We tend to think that past events affect future possibilities. 8. Dunning-Kruger Effect - The less you know, the more confident you are. The more you know, the less confident you are. 9. Cause-Effect Fallacy - We always look for cause-effect relationships. Thus, we find patterns even in totally random data. 10. Hyperbolic Discounting - We are wired to prefer instant gratification (e.g. payouts). Even when offered significantly more in the future. 11. False Consensus Effect - Too often, we overestimate the degree to which others agree with us. 12. Psychological Denial - When something terrible happens, we tend to fall into a state of denial.