Today, April 15, is tax day in the U.S.  It’s the day to pay the piper…er…the federal, state and local governments the taxes that are due.

I don’t want to depress you, any further than you already are, by talking about how much money you’ve paid in taxes to the government.

But I do want to talk about a concept that TV and radio personality Dave Ramsey calls “Stupid Tax.”

Stupid Tax is the money we’ve spent (wasted) on decisions that ended up being financial mistakes or errors in judgment that cost us more than we bargained for.

Have you ever made a rush decision to buy something that seemed like a great deal at the time, but later you regretted? Like…

• A timeshare condo that you ended up rarely using and took a big loss on when you finally sold it?  Stupid Tax!
• A four-day cruise package that you paid a great price for up-front, but never used?  Stupid Tax!
• A “how to use other people’s money to get rich in real estate” program or workshop you attended that cost a bunch of money up-front, but…of course…you’d make back pretty quickly on your first deal…that you never ended up doing?  Stupid Tax!
• Equipment for a business you were really excited about starting…but after starting it you got really unexcited about it? And worse yet, you bought it on credit and ended up paying for it long after you stopped using it?  Stupid Tax!
  

Whether we want to admit it or now, all of us have paid Stupid Tax at some point in our lives.  Some, sadly, have paid a lot more than others.  I’ve known more than a few people who got sucked into buying the timeshare.  I’ve never done that (and don’t think I ever will), but I have fallen prey to the other three things I listed.

In many cases, once the deal is made and the money is spent, we can’t go back and undo what was done.  So what do we do when the regret sets in, and how can we minimize the damage that was done?

1. Admit that you just paid Stupid Tax.  I think it is important to admit (at least to ourselves, if no one else) that we’ve made a mistake.
2. Determine to learn what you can – about yourself, your decision making process, your true motives, and how you could have handled things differently.
3. Look for a way out.  Think of all the possible ways you might be able to get out of the deal.  Search the Internet and ask your friends if they have any ideas.
4. Look for a way through.  Think of all the possible ways you can make the most of it.  Can you re-sell it?  Can you find a way to use it after all?  Can you give it to someone who can use it?
5. Resolve to do things differently next time you’re tempted to make a quick, or expensive decision. Decide now how you’re going to handle future decisions.
6. Check out the links below for other tips.

Despite all the Stupid Tax I’ve paid in my lifetime due to ill-conceived and ill-advised decisions I’ve made, I’m convinced that paying Stupid Tax is not the worst thing that could happen to me.  However, paying Stupid Tax more than once for the same type of thing…is!

Please share your comments. What kind of Stupid Tax have you paid in your life?  How were you able to overcome it?

You might aso like:

• Know your life’s purpose…make great decisions?
• 8 tips for overcoming a bad decision or mistake
• The decision making process:  7 strategies for success

Tournament Brackets: Not just for March Madness, but also for your life.

My posts over the last week or so have dealt with how stress and busyness can keep us from living a balanced life and achieving true success in our life and work.

For many, the major cause of stress and busyness is the choices (or lack of choices) that we make.

I’ve observed in my own life that it’s not the choice between a good activity and a bad activity that causes my life to get out of balance.  In fact, those choices are usually quite obvious, and quite simple to make.

Rather, it’s the choice between two seemingly good activities that can lead to stress if I have no basis for making a decision and no plan for prioritizing them.

The recent NCAA March Madness basketball tournament reminded me of an interesting – and fun – technique to help make decisions and clarify priorities between any number of seemingly good or equal choices.

This technique, called tournaments, is described in the book, The On-Purpose Person: Making Your Life Make Sense, by Kevin W. McCarthy.

The idea is that if you have a bunch of seemingly equal goals or lists of wants, dreams or tasks that you need to prioritize, you make them compete against each other using a tournament bracket just like in the NCAA basketball tournament.

Sample of an alternating list

The first step is to put your list on paper.  McCarthy suggests that as you make your list, you alternate writing the items from the top to the bottom of the page, so that as you write, your list converges in the middle.

You can see from my sample that item #1 goes at the top, and item #2 goes at the bottom.  I alternated back and forth until item #11 rounded-out the middle.

Next, you’ll want to create tournament brackets and place each item from your list, one at a time, in the brackets.  You can see from the next sample that I’ve placed the list items on the bracket in the order of how they appear on the list from the top.

Tournament Sample

So item #1 and #3 play against each other first, then items #5 and #7, etc.  If you have an odd number of tasks, like I did in the sample, you’ll have a few “byes”, where that task automatically advances to the next round.

The winner of each competition goes on to the next round until you have a winner, which becomes your top goal or core priority to focus on first.

This doesn’t mean the other goals or tasks are “losers”, it just means that they are lower in priority, and will get less attention, at this time.

If you’re like me and you struggle from time to time with analysis paralysis, this will force you to HAVE to choose.  Don’t sit and agonize over a choice.  Just go with your first instinct.

When you’re done, take some time to think through your decision making process.  What was your rationale for deciding that one item was more important than another?  What things seemed more important to you as you made each decision?  By taking the time to do this, you’ll identify some values that will help to guide you for future decision making.

I love how quickly these tournaments help you clear away the clutter.  You can use them to discern your core priorities within each life area, prioritize daily tasks, focus your thinking on major projects, and more.

In fact, you’ll see in the samples that I used tournaments to prioritize my task list for things I need to do at home.  My wife will be so happy!

Have you ever tried tournaments before?  If so, how’d it go?  If not, do you think you’ll give them a try?

You might also like:

• The decision making process:  7 strategies for success
• Know your life’s purpose?  Make great decisions
• Reduce work stress:  Do your most important work first

We’ve been talking about decision making, specifically how to make good decisions, here at Life Compass. Last time, I shared 7 strategies to help you increase your chances for success in the decision making process.

But, what if it’s too late, because you’re already in a tough situation?  Or what if, despite your best efforts in the decision making process, you end up with a decision that goes awry, or discover you made the wrong choice?  Perhaps it’s because you made a mistake in how you implemented the decision. Or maybe it is due to external factors or unintended consequences?

Five or six years ago, I found myself in the middle of a bad decision. I had started a concessions business, selling kettle corn (slightly sweet, slightly salty popcorn) at arts and craft fairs, festivals and events, as a way to increase my income.

I first explored this idea online, and then talked with a person who was in the business (and who also made and sold kettle corn poppers). It sounded great!  I could make a lot of money if I got into the right events.  But it would be a lot of work.  Oh, and the  start-up costs were around $5,000 (including the popper, canopy tents, tables, supplies, and a utility trailer to haul the popper and supplies).

I decided to do it.  And at first, it was fun.  After a year and a half, I realized that it just wasn’t the right fit for me.  That business was certainly great for some people, but not for me.  Here’s why:

1. I should have known how hard it would be for me to be away from my young family (4 kids under age 9 at the time) for so many weekends.
2. With many events being out of town, my expenses were higher because I had to hire additional help and pay for hotels and meals.
3. It was almost impossible to get into the best events because other kettle corn vendors were already “locked in”.
4. It didn’t really fit my skills and abilities.  There was a little marketing and customer service involved (which I enjoyed), but mostly it was hard labor (stirring that great big pot over a very hot flame).  I realized that I could get a higher payoff by engaging in activities that were more enjoyable for me long-term and that better aligned with my giftedness (in other words, I knew I could work smarter, not harder).  I’ll tell you more about my other entrepreneurial activities another time, because I still believe that owning your own business, either full or part-time, is a great way to build wealth.

So I decided to pull the plug on it, take my losses, learn my lessons, and move on.

Here are 8 tips I discovered on how to recover from, and make the most of, a bad decision:

1. Own up to it – Be willing to admit it when you or others have noticed there could be a mistake or problem. (This was pretty easy for me to do.)
2. Be real – Determine whether you made a mistake by taking this course of action, or are things just harder than you thought (or wanted to admit) that they’d be during the decision making process. (I believe I made a mistake, and I also believe I didn’t accurately imagine, during the decision making process, what things would be like.)
3. Don’t blame others – Human nature tends to want to blame others for our mistakes or problems. Don’t do it – even if someone else contributed to the problem. (I had no one else to blame.)
4. Don’t blame yourself – Some people are too hard on themselves and beat themselves up.  There’s no need for that. (I don’t think I unduly blamed myself, but I did own up to it.)
5. Set a time table and benchmarks – If you’re not sure there’s a problem, or if you don’t know how severe it is, set a time table and some benchmarks before you pull the plug. You might just be able to turn things around without canceling everything. (I may have been able to make that business work, but I was not willing to pay the price, in terms of being gone from home so much, and having to work so hard physically.)
6. Seek to renegotiate - If possible, talk to everyone who is affected by the decision or mistake. Is there a way to renegotiate or work around the situation? Explore how what’s been done wrong be undone or redone. (If I wanted to keep doing this, I would have had to renegotiate with my wife.  But neither of us were interested in going any further.)
7. Remember that adversity builds character - It might sound cliche, but it’s true. Everything is a learning experience. Write down your experience so you can reflect on it, and learn from it later. (Yes, I did that.)
8. Look on the bright side – Remember, things can always be worse!  (That is totally true.)

What do you do when you’re faced with a bad decision or mistake?  Would you add anything to this list?

Oh, and is anyone interested in buying a slightly used kettle corn machine?

You might also like:
The Decisionmaking Process:  7 Strategies for Success
How knowing your life’s purpose will help you make great decisions
How to turn problems into opportunities

The ability to make good decisions is a key to success in life, and in maintaining work-life balance, wouldn’t you agree?

Yet many of us, myself included, struggle at times in the decision making process, for fear that we’ll choose the wrong option.

This is especially true when it comes to important decisions regarding our family, career, business, etc.

Like whether to go back to school, quit your job, start that business you’ve always wanted, start a family, or work from home. Or maybe decisions regarding how to care for an elderly parent or how to help your child pay for college/university.

Yesterday, in my post on How to Make Good Decisions, I promised I’d give you some tips on how to make good decisions, so…

Here are some seven tips on how you can improve your chances for success in the decision making process:

1. Embrace the decision making process – Yogi Berra said, “When you come to the fork in the road…take it.” My interpretation is that when you are faced with a decision, embrace it. Don’t shy away from it.
2. Start with a well-defined goal – Be sure you fully understand the question or problem before you make a decision or provide an answer.  As one of my mentors says,” Sometimes, how we see the problem is the problem.”  If the decision has to do with major areas of your life, like your career, family, finances, etc., you really need to develop a life plan so you know where you’re going.  Decision making is easier when you have a clear goal in mind, because you choose from choices that will move you toward that goal and avoid choices that won’t.
3. Seek wise counsel – Solomon, one of the wisest men who ever lived, said “Plans go wrong for lack of advice; many counselors bring success.” (Proverbs 15:22)  Don’t be afraid to ask for advice – from wise people you know, or even from people you don’t know personally, but you know they have experience you can gain from.  Most people are more than willing to share what they know, if it’ll help someone else.
4. Don’t fall into the trap of the paralysis of analysis – While it is important to weigh all the options, don’t allow yourself to freeze up for fear that you’ll make a wrong decision.  A friend said, “A good decision is not always the best decision, but it is better than no decision.”
5. Resolve yourself to the fact that you may not make a perfect decision -  You’ll never know all the things that you don’t know about a given situation.  Be diligent in doing the best research you can, make your decision, and be OK with it.
6. Pre-make your decision – If you have the luxury of time (and let’s face it, sometimes we do, and sometimes we don’t) make a decision and then sit on it a while.  Spend a few days, a week or a month living in the decision, as if it had already been made.  For example, if you’re considering whether to take out a loan to buy a car, and the payment will be $300 a month, start living that way now by putting away $300 a month into savings.  How does it feel?  How does it impact your other spending decisions?  Does it line up with your financial goals and life plan?  Them imagine what it would feel like a year from now?  Does it still feel good and seem like it makes sense for you?
7. Make your decision with FOCUS – Once you’ve made your decision, go all-in with your decision.  Don’t second-guess yourself or try to re-analyze it.  I love this acronym from Nicole Dean:  Follow One Course Until Successful.  Figure out all the things you need to do now that you’ve made your decision, make a plan, and do them until it’s done.

Would you add anything to this list?  Have any of these strategies benefited you in the past?  Please share your thoughts in the comments section.  In my next post, we’ll explore ways to recover from, and make the most of, a bad decision.

You might also like:
How knowing your life’s purpose will help you make great decisions
How to turn problems into opportunities
Decision making process – WWJD?

Recently, I noticed that one of my kids was having a hard time making decisions. Over the holidays, we were on a Caribbean cruise and this child had difficulty deciding what to eat at nearly every meal.

If you’ve been on a cruise before (this was our first time), you know there are plenty of options and dozens of food choices available to you at each meal. Most of the options would have been good choices for him. Some were even great choices – his favorite foods. But a few were not so great and he wouldn’t have enjoyed them at all.

When it came time to place his order, he froze. He simply couldn’t decide.

Have you ever found yourself struggling to make a decision – maybe regarding a possible career change, starting that business you’ve always wanted, or some choice regarding your finances, love life, or family – because you were afraid you’d make the wrong choice? I have.

On one hand, it makes sense because we want to ensure that we make the right choice and avoid any pain or expense that may come from the wrong choice. And let’s face it – some choices carry with them some emotion pain and financial expense.

On the other hand, we can get caught up in “the paralysis of analysis.” What that means is that we can analyze the situation so much that, in order to avoid making the wrong decision, we don’t make any decision at all.

At times, it can seem like making no decision IS the safest decision to make. In reality, playing it safe by making no decision is, in my experience, often the wrong decision, because we’re not moving forward at all or taking any action.

Over the next few posts, I’ll share some tips that have helped me improve my chances of making the best decisions possible. And, I’ll share some ideas on how to recover from, and make the most of, bad decisions.

If you haven’t done so yet, please subscribe to my RSS feed, so you won’t miss future posts.

You might also like:
Know your life’s purpose…make great decisions?
Decision making process:  how to turn problems into opportunities
Life’s greatest truth and hardest lessson:  everything is a choice

The following is an excerpt from The Rhythm of Life: Living Every Day with Passion and Purpose.

In almost every moment of the day, we find ourselves being confronted with questions and opportunities.  Our lives are a constant flow of decisions. What will I eat?  What will I wear?  Where will I go?  Whom will I go with?  What will I do?  What will I buy?  Where will I live?  Life is always asking us questions. Often they seem small and insignificant, but in truth they can significantly impact our lives.

We have options.  I could watch television for an hour every day or exercise for an hour every day.  I could eat McDonald’s every day for lunch or I can have soup and a salad.  We choose between various options a hundred times a day, and our choices impact our health, happiness, well-being, and destiny.

In his classic poem, “The Road Not Taken,” Robert Frost describes coming to a fork in the road and having to choose between the two paths that lie before him.  The poem closes with one of the most famous lines of modern literature:

“I took the one less traveled by, and that has made all the difference.”

Too often the poem is interpreted as being about one monumental moment, one enormous decision, that determines the outcome of a person’s whole life.  It is as if, once this one decision is made, all is well, and the rest of the road is smooth and slopes gently downhill.

The poem is not about one moment in a person’s life.  It is about every moment of our lives.  We find ourselves constantly at a crossroads.  No sooner do we make one decision and take three or four steps down either path than we come upon two roads diverging in a yellow wood…again!

The fork in the road is constantly appearing in our lives.

The ability to choose comes from a sense of purpose.  Leaders are charged with the responsibility of making decisions, because they above all others are supposed to understand the purpose of the people or organization they lead.  Direction comes from an understanding of where you are going.  If you don’t know where you are going, you are lost.

When we have a sense of our purpose, the decisions of our daily lives can be easily assessed with that purpose in mind.  Direction emerges in our lives by bringing our decisions before the altar of our essential purpose.

If you make great decisions, you will live a great life.

As I’ve shared here before, I’ve been on a journey of discovering and living my life’s purpose for about ten years now.  Over the last two years, I made a series of decisions regarding my career and lifestyle.  I weighed those decisions based on my life’s purpose and goals, and they ended up being great decisions.

What about you?  How has knowing your purpose made decision-making easier?  Or, can you point to an instance when you know you could have made a better decision if you had known your purpose more clearly?

You might also like:
How to clarify your life purpose
Decision making process – How to turn problems into opportunities
Life’s greatest truth and hardest lesson:  Everything is a choice

A few years ago, in a conversation with one of my mentors, I explained that I was dealing with a particular problem that was weighing heavily on my mind.

As I described the situation, he listened intently, seeking to understand what I was saying.  Then he said something that absolutely took me by surprise.  I was expecting empathy, sympathy, and possible solutions.  Instead, he said:

“Who says your problem’s a problem?”

I replied, “What do you mean?  I just told you the situation.  Of course it’s a problem, and I’ve got to figure out what to do.”

He went on to explain, “Yes, I understand you have a situation here that you’re dealing with.  But who says that it is a problem?  With every problem, there is an opportunity.  And I believe you really have a big opportunity here to explore and make the most of, instead of a problem to manage.  That is, if you choose to see it that way.”

Next, he helped me look at my situation from different angles and perspectives.  Then he shared some possible courses of action that I could take, and the potential results of those decisions…both in the short-term and a few years down the road.

One thing I noticed was that some solutions, which seem to have the lowest cost right now, have higher costs down the road.  And I’m not just talking money, but also our energy, emotions, relationships, goals, etc.

Later, when our conversation came to a close, I thanked my mentor for helping me gain a new perspective on my situation.  He gave me some real hope for what I thought was more of a hopeless situation.  As he left, he gave me another pearl of wisdom that took a minute to sink in…but once I got it, I got it.  He said:

“Sometimes, how you look at a problem is the problem.”

The next time you’re stumped by a problem or situation, and you just don’t know what to do, you might give these tips a try:

1. Gain a new perspective by looking at the problem from different angles.
2. Make a list of all the ways you could possibly benefit from this situation.
3. Pretend that you are a coach who is helping someone else in this situation.  What would you advise them to do?
4. Pick your top three possible courses of action, then count the cost of each one, both in the short-term and long-term.  Play them out in your mind.  If you went this direction, how would it feel at first?  How does it feel a month or six months down the road?  What are the ramifications, both good and bad?  Can you live with them?
5. Then pick your top possible solution, and ask yourself:  “If I go this route, does it really address the real problem?” This is an important question, because it is all too easy to deceive ourselves into thinking we’re doing the right thing to address the problem, but then our choices results in unintended negative consequences.  Don’t believe me?  Just ask Congress.

If you’re new to Life Compass, on Sundays I write on Spirituality, Faith and Ethics.  I do it because I believe we’re all spiritual beings and have some sort of a moral compass in our lives, and because the topic personally interests me.  You can learn more by clicking here.

Question:  How do you make decisions?

I know, you will probably have a hard time deciding your answer!  Because we don’t often think about how we make decisions, we just make them.

But really, we don’t make decisions out of thin air.  From our childhood until now, we’ve learned how to make decisions – big ones and small – by observing our parents, teachers, friends and others.

Some decisions, like what to eat for lunch, can be easy and have relatively no consequences (unless we’re trying to lose weight).

Other decisions, like what company to work for, or what person to marry, are difficult and can have long-term, even life-long, consequences.

Some decisions impact no one but ourselves, others have ethical implications that affect our family, co-workers, and our community.

So, shouldn’t we give some thought to how we make decisions?  And shouldn’t we learn how to make the best decisions possible, to minimize risk and harm to ourselves and others?

“WWJD” was a slogan that was made popular a few years ago on bracelets, t-shirts, bumper stickers, etc.  The acronym, which stood for “What Would Jesus Do,” was a reminder for people to ask themselves “what would Jesus do?” if he were faced with this decision or choice that I’m about to make.

Whether you follow Jesus or not, the point is this:  When we’re faced with difficult decisions, whether they have ethical implications or now, we can get guidance from other successful people we admire or aspire to be more like.

One way we can learn from others is by reading biographies of famous leaders and decision makers.  Another way is to read books about leadership and decision making. One of my favorite authors is Dr. John C. Maxwell.

I think one of the best decisions you and I can make is to decide to improve our decision making ability.   It is a skill that will serve us well in every area of life.

Who do you follow?  Who do you learn from, when it comes to making great decisions?  I’d be glad to hear your thoughts and comments.