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I cannot count the number of times I have heard people say, “If I only had a million dollars!” “Then I would take some time off, spend more time with my family, take that trip, start that business, do that one thing I have always wanted to do.” I have come to the...

Bill Gates founded Microsoft in 1975 with ambitions of putting personal Computers into every home. Mr. Gates understood investment returns well and had the abilities to invest Microsoft’s massive cash flow almost anywhere — back into the company, into the stock market, into corporate bonds, pay it as a shareholder dividend, the list goes on and on. But instead of taking advantage of any number of these high-yield options, he did something else with his cash: he kept it. 

I know of some people who have received payouts of hundreds of thousands of dollars from insurance claims, legal disputes, or inheritances. In most of these instances, receiving this money felt life changing. It’s extremely uncommon for people to be sent a check with five or six zeros in it. For most of us, we will only have a small handful of times in our lives (if at all) where we will receive a large amount of money. And when we do receive it, we are rarely prepared for how to handle it. 

Tony Hsieh is most commonly known for his incredible business success, particularly as the Founder and CEO of Zappos.com. A born entrepreneur, Tony co-founded the company LinkExchange at the age of 23 in 1996 which he sold two years later to Microsoft for $265 million. Many of Tony’s best ideas came from simple observations he made throughout his business career, but his greatest investing insights came from an obscure place — the poker table. 

In Annie Dukes new book, How To Decide, she opens the book by asking readers a simple question. During last year what was the worst decision you made, and what was the best decision you made? This question sounds easy enough. Then she asked readers to think about the outcome of both of those decisions and compare them to how we assessed the success of our decision. What often happens here — as it did to me — is that our best decision had the best outcome and our worst decision had the worst outcome. We connect the outcome to the quality of the decision. This is what’s wrong with the analysis of our decision-making abilities.