How prospect theory can help strengthen habits and achieve what you want

2024 Author: Malcolm Clapton | [email protected]. Last modified: 2023-12-17 03:44

Learn to use the right attitude to risk to achieve your goals.

Imagine being offered a deal like this:

• A: 90% chance of winning 10,000 rubles.
• B: guaranteed opportunity to win 8,000 rubles.

Which would you choose? Most people choose the safe option B, although the expected benefit in the first option is greater.

Or another example:

• A: 85% chance of losing RUB 10,000.
• B: guaranteed loss of 8,000 rubles.

Still choose B? The first option is most often chosen, although the amount of the probable loss in it is more - 10,000 instead of 8,000. When there is a high probability of losing money, people are more likely to take risks.

Psychologist and economist Daniel Kahneman derived these patterns and explained them in his perspective theory. It describes our attitude to risk and loss. To put it simply, losses upset us more than winnings make us happy, even when they are the same size.

	Small probability	Medium and high probability
Winnings	Risk appetite	Avoiding risk
Losing	Avoiding risk	Risk appetite

This attitude towards risk influences all the decisions we make. If used correctly, you can make it easier for yourself to move towards your goal and develop new habits. To do this, rephrase the goal or habit in terms of potential losses, not potential gains. Blogger Kunal Shandilya shared this advice.

For example, you want to meditate for 10 minutes every day. This is your old approach, focused on the benefits you will receive. Instead, formulate a goal like this: do not skip meditation for 10 minutes every day.

In the first case, your natural state is not to meditate, and you want to change that. In the second, the starting point, on the contrary, is the habit of daily meditation.

This is how you set yourself a higher bar to stick to.

This is an important part of the technique. If you do not have this high bar, then there will be no possible losses to be avoided.

If you want to test if this approach works for you, do a two week habit experiment. During the first week, work on the two habits as usual, that is, focusing on winning. And on the second, reformulate one of the habits, focusing on losses. Record how much you have succeeded in adhering to both habits each day. At the end of the second week, compare the results and draw your own conclusion.