CashNews.co
In an increasingly uncertain world, choosing the right path can be fraught with risk, leading to heightened levels of mental anguish. Nearly seven out of ten of us (68%) believe it is harder to plan than it used to be, according to a major new global study called ‘Seizing Uncertainty’ from HSBC that shares tips on how we can all be more confident when it comes to making decisions about our finances.
The challenges we face in choosing the best path for our futures are a concern for many people, the study found. Almost half of us (48%) say we have experienced increased feelings of stress and anxiety in the last five years and more than half of us -53%- say we feel ill-equipped to make key decisions.
HSBC said this led to ‘decision paralysis’ when it comes to making financial decisions – something that the study finds affects nearly a third of us (38%), rising to (40%) in Generation Z. It is perhaps unsurprising then that being more confident in our decision making is a goal held by most of us. Two-thirds of people -63%- wish they felt more capable of tackling decisions head-on, the study of 17,555 people across 12 markets, found.
Making good decisions is a life skill that can therefore reap significant benefits, especially when it comes to complex matters such as financial planning which can be bewildering and intimidating. To help people address this uncertainty decision gap, HSBC has created a Decision-Making Guide, which breaks down the components of good decision-making.
Katie Wilkins, Global Head of International Propositions, HSBC Wealth and Personal Banking said: “While we can’t see into the future, we have found a number of habits that are common among those who feel confident in making decisions even when the outcomes of those decisions are unclear or uncertain. Drawing on a strong and trusted network, including talking to family and friends, can counter feelings of feeling alone with a decision and help provide different and valuable perspectives. Together with doing your research, being willing to fail, working through scenarios and listening to your instincts, you can build more confidence in decision-making and feel better prepared for what could come next.”
Professor David Tuckett, Seizing Uncertainty’s Academic Advisor, and a leading expert on decision-making among fund managers, said: “Across the world change and uncertainty are the norm, not the exception. In this context of radical uncertainty, individuals, businesses, and economies are facing heightened complexity and constant disruption. Addressing this gap and empowering more people to be confident when making decisions will be a key factor in extending opportunities and building a fairer and more prosperous society.”
HSBC’s decision-making model is comprised of two elements – The mindset and Method.
When it comes to The mindsetthe report identifies five key attributes we should cultivate before making decisions:
- Being optimistic
- Open to change
- Tolerant of uncertainty
- Unafraid of failure
- Opportunity-oriented
A healthy decision-making Method draws on three valid sources of information:
- Data and facts – making sure you are doing your homework and getting data and hard facts from verified, credible sources.
- Our intuition – it’s important to actively listen to gut instinct as source of what feels right.
- Trusted networks – in today’s digital world, leaning on your peers, trusted experts and your friends and family is crucial, as they understand the context in which you are making decisions.
Activating the confidence spiral – the Seizing Uncertainty study demonstrated that when all of the above elements are combined, people develop the confidence to make decisions.