How to Make Smarter Decisions by Designing Your Defaults

in Personal Development

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Do you want to make smarter decisions everyday day? You can. All you need to do is harness the power of defaults.

90% of your daily decisions happen automatically, many shaped by environment. Thus, most decisions are a habit, not a deliberate choice.

And habits can be developed by shaping the invisible defaults of your life. To make smarter choices, design smarter defaults.

Is your phone charging next to your bed while you sleep?

It’s the first object you touch immediately after waking up. A ton of notifications await. Checking social media and email easily becomes a habit as soon as you wake up. And after at least a couple of minutes of infinite scrolling, you get up.

What if, instead of your phone, you place a water bottle next to your bed? For a while, you would feel something is missing. But soon enough drinking water becomes the first habit of the day.

Once you remove the phone from the picture, suddenly a good habit — drinking water after waking up — becomes easy to perform.

And that is the power of defaults.

The Power of Defaults

Eric Johnson and Daniel Goldstein conducted a study that revealed just how much your environment impacts your behavior — often without you even realizing it.

This graph shows the percentage of people, across different European countries, who are willing to donate their organs after they pass away:

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In a continent where countries are very much alike, what could cause such a difference? Initially, the researchers thought the difference in donations would be caused by the “big” reasons, such as religion and culture. But that wasn’t the case.

For example, Austria and Germany are located right next to one another, sharing geographic, cultural, and social similarities. It would make sense that their donation rates would be roughly the same. And yet, only 12% of the population in Germany has chosen to become an organ donor while almost all of the Austrians (99.98%!) have chosen to donate.

Could the researchers explain that massive gap between similar countries with a single factor?

Do Defaults Save Lives?

They focused on measuring the change in organ donations by focusing on a single factor: the no-action default for agreement.

In organ donation, countries use one of two possible policies:

  • Required “Opt-In”: people who want to be an organ donor must give explicit consent to doing so
  • Default “Opt-In”: also known as presumed consent, users are signed up as organ donors by default and need to require to opt-out

Countries who employ a default opt-in (presumed consent) scheme see average rates of 97.56% compared to countries who employ a default opt-out (explicit consent), where the average rate is 22.73%.

As Richard Thaler and Cass Sunstein have reported in Nudge: Improving Decisions About Health, Wealth, and Happiness:

“In Germany, which uses an opt-in system, only 12 percent of the citizens gave their consent, whereas in Austria, nearly everyone (99 percent) did.”

While large majorities of Americans approved of organ donations, only about a quarter consented to donate their own.

On the other hand, nearly all Austrians, French and Portuguese consent to donate theirs. The default explains the difference. In the United States, people must choose to become an organ donor. In much of Europe, people must choose not to donate.

And countries with presumed consent policies don’t just have more people who sign up to be donors. They also have consistently higher numbers of transplants.

Defaults are so powerful they save lives.

Your “Golden Years” on Autopilot

Most Americans are bad at saving money for the future, especially for retirement. And the current defaults don’t make it any easier. Many companies’ retirement plans — such as 401(k)’s — are opt-in. You need to head to HR to get enrolled, and you might need to understand a bit about investing.

But an alternative strategy has seen massive success: automatic enrollment. This means that employees are enrolled by default, forcing them to decide to opt-out in order to not contribute to retirement automatically. Now employees make smarter decisions by default.

Under these circumstances, participation in 401(k)’s skyrockets. This chart shows that, for one company, participation among new hires rose from less than 20 percent to over 90 percent:

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However, this system retirement savings stuck at the low default contribution rate, often 3%. That’s not much to be contributing year after year. So many employers now implement automatic escalation, which means you agree on up front to raise your contribution by 1 or 2% every year.

Economist Richard Thaler — the author of “Nudge” — devised one variation of automatic escalation called “Save More Tomorrow”. It ties the increased contribution to your next pay raise, so you don’t “miss” the money so much. Thaler estimates that automatic escalation programs have boosted annual savings by $7.4 billion.

Little defaults can add up to a lot of cash.

Positive and Negative Defaults

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When you’re faced with a challenge and need to make a decision, your brain starts to look for the path of least resistance. Frequently, you go with the default option.

Let’s suppose you commit to run for 30 minutes every day after work. But when you get home tired after a long day at the office, all you want to do is binge-watch Netflix. And so that’s what you do instead. Because it’s the default, and it’s easier.

But what if you were to remove your ability to watch television?

You unplug the TV and cancel your subscription. Now your previous default is not accessible anymore. This is called “default to zero” and it can be a powerful hack to change behavior through negative reinforcement and force you to make smarter decisions.

Will you go running? You might. But if not, at least you won’t be watching television instead. And even if you try to cheat — by plugging the TV and getting Netflix again — it’s going to take you a few minutes. Because your ability to do it has been reduced, you’ll be more resistant to do it.

Now, let’s couple that with positive reinforcement. To increase your ability to go running, place your running shoes by the front door (or next to the bed if you want to run after waking up). The hardest part of any run is starting, and making your shoes more accessible make it easier to make the smart decision.

You just designed your life as a choice architect.

On one hand, you encourage smarter decisions you want to do by making them more accessible. And you add friction to habits you want to quit, making them less accessible, or remove the option to perform them altogether.

Defaults to Make Smarter Decisions

We are defined by the choices we make. And, as we now know, most of the choices we make are automatic. If you plan your defaults, you make smarter decisions every time with little effort.

Default decisions are everywhere. They are the settings that come out of the box, the selections you make on your computer by hitting enter, the assumptions that people make unless you object, the options easily available to you because you haven’t changed them.

They might not seem like much, but defaults (and their designers) hold immense power — they make decisions for us that we’re not even aware of making. Consider the fact that most people never change the factory settings on their computer, the default ringtone on their phones, or the default temperature in their refrigerator. Someone, somewhere, decided what those defaults should be — and it probably wasn’t you.

Defaults are powerful nudges as they require you to actively object for it not to work. But people have a strong tendency to go along with the status quo or default option.

We are nudged all day, towards good and bad decisions. The good news is you can design your defaults in many areas in life to help you make smarter decisions. Turn your automatic decisions into good ones and you will naturally make the right choice.

“First, never underestimate the power of inertia. Second, that power can be harnessed.” — Richard Thaler in Nudge

Here are a couple of defaults you can adopt in your life to make smarter decisions. To make it easier to read, I’ve divided them into Health, Wealth, Work, and Life.

Make Smarter Decisions in Health

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Eat healthier

  • Remove from the house food that isn’t on your diet or you know is unhealthy. To always make smarter decisions, stop buying them at the supermarket altogether
  • Buy items from the outer edges of the grocery store. Healthy, wholesome foods are on the perimeter. Junk and processed foods tend to live in the aisles
  • Trick your brain into eating less per meal by using smaller plates and bowls
  • Plan your meals in advance so you always know what to eat each day. Use Sundays to cook for the entire week and freeze excess food
  • Do not keep alcohol at home. If you want to drink, you’ll have to go outside and buy it when you need it

Drink More Water

  • Have a bottle next to your bed so you get in the habit of drinking water immediately after waking up
  • Keep a water bottle at your desk throughout the day and fill with it cold water to energize your brain
  • Only have water at home. Ban everything else, especially juice and soda
  • Always order water when eating out, instead of soda. Bonus points: it’s cheaper
  • Drink a glass of water before meals. It will also make you less hungry

Sleep Better

  • Put an alarm on your phone by default an hour before bedtime to remind you to begin your pre-bed ritual
  • At that time, leave your laptop and mobile phone in another room and physically unplug the TV
  • Leave a book at your bedside table within arm’s reach. Make sleep an easier option than playing on your phone
  • Use f.lux to automatically adapt the color of your computer’s display to the time of day, warm at night and like sunlight during the day

Exercise More

  • To make smarter decisions and exercise regularly at the office, keep a dumbbell next to your desk at work to pump out some quick curls
  • Use a gym partner to create accountability and make sure you exercise. Making the trip to the gym is the hardest part
  • Get a doorway chin up pull up bar and do a couple of pull-ups every time you enter or leave your bedroom
  • Lay out your workout clothes the night before and put them next to your bed. The moment you wake up, you’ll have everything ready to go
  • Always park your car a healthy distance from your destination, such as the far end of the parking lot or the opposite end of the block
  • Take the stairs when you have a choice. You’ll work more steps into your day without having to work in the time needed for a traditional workout
  • Stand up during meetings at work

Make Smarter Decisions in Wealth

Spend Less

  • Go to your bank and cancel all your credit cards. There, no way to spend money you don’t have
  • Use cash for your daily expenses by default. Set a weekly limit and withdraw every Sunday. When you run out of bills, you run out of money to spend. If possible, carry larger bills: you are less likely to spend larger currency denominations than their equivalent value in smaller bills (a cognitive bias called the denomination effect)
  • Never buy something on impulse. To always make smarter decisions, here’s a simple motivation hack: think about how many hours it took you to earn that amount. Give yourself a week to ponder and ask yourself if the purchase is removing a negative from your life
  • Install the Icebox browser extension to block you from making purchases with the “Buy It Now” button. It keeps track of the items you view so can revisit them later if you still want them
  • Go for quality, not quantity. A nice pair of shoes can last years wheres a cheap pair will break easily and cost you more in the long run
  • Define a “no spend” day every week. It’s hard to go an entire day without spending money but it will make you more aware of your spending habits
  • Always have “Shopping List” note on your phone and add items as they run out. Stick to the list when grocery shopping. Extra hack: go to the supermarket when you are full, such as after a meal
  • Write all your expenses on a Google Sheets. Review receipts and purchases during the weekend. Being aware at all times of the level of your spending influences the decisions you make in the future
  • Cancel unused subscriptions and everything you can live without or are ok with the limitations of the free version (such as ads or upload limits). Upgrade to yearly plans on the ones you do to save money

Save More

  • Pay yourself first: create a recurring transfer to a savings account each time you get paid. What remains becomes your monthly budget
  • When you get promoted, keep your monthly expenses at the same level as before and default all the additional income to savings. This is one of the smartest decisions you can make in money
  • Match bad habits with savings: for every dollar that you spend on something you want to consume less of — such as alcohol — match it with a deposit into savings. Micro-transactions feel less painful
  • Place a piggy bank at your entrance. When you get home, put all your coins in it. Don’t underestimate the power of piggy banks: small change adds up fast. I saved almost $3000 AUD in less than a year in Australia. And now, even living frugally, I get around 300–500 euros every 3 months. Deposit your piggy bank into a savings account

Make Smarter Decisions at Work

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Deep Work

  • Work in full-screen mode to remove all distractions and focus on the task at hand. A simple tweak, but it works wonders
  • Always wear headphones. I rate my Bose QuietComfort 35 as one of the best investments I ever made. Coworkers will think you can’t hear them and the barrier to interrupt you is much higher. Even when you do hear them, pretend you didn’t. Most of the times they won’t try a second time
  • Plan your entire week on Sunday. Schedule tasks directly on the calendar to allocate time for them
  • Listen to the same song on repeat. This will help you lose track of time and become more focused
  • Design productivity spaces for different types of work. By using location-based prompts and creating productivity spaces for certain types of work, you may find it easier to buckle down to your tasks
  • Request to work remotely for one day per week. Start by asking for a half-day, preferably mornings

Productivity

  • Clean your desk at the end of the day. An uncluttered desk is easier to work in and removes distractions from sight. Do the same for your computer desktop: it should be clean, no folders or apps
  • To avoid decision fatigue early in the morning, choose all your outfits for the week on Sunday night and put them in order. One less decision every morning can go a long way
  • To stop procrastinating, use the 2-minute rule: if it can be done in 2 minutes, just do it; if it takes more than two minutes, start it. Simply working on it for two minutes will help you break the first barrier of procrastination. 9 out of 10 times, it leads to working on the task for far longer than 2 minutes (continue working using the Pomodoro productivity hack)
  • Only use a handful of productivity apps to get things done
  • It’s easier to work with 3 apps than 10. Use “Swiss army” apps that can be adapted to different types of work. Less is more

Email

  • Disable email on your phone to stop checking it throughout the day. On the iPhone, you can delete your email account in Settings. For Android, you’ll need to disable the Gmail in App Settings
  • Treat checking emails as you would any other tasks: a to-do. Schedule specific times in your calendar to process email
  • Reduce the times you check email to 2 per day: one in the late morning and another in the late evening
  • Don’t check your email before 11 am. Spend the early morning performing Deep Work on critical work that moves the needle on your goals
  • Train other people to respect your productivity, work, and time by using an automatic response. Long-term sustainable email productivity is about selective ignorance. Let people know you’re checking emails less often in order to be more productive
  • Default all communications to email. When a coworker interrupts you at your desk, gently tell him you’re working on something right now and if they can send you an email to remind you later. If someone wants to set up a meeting, make it a necessity to give you an agenda by email before phone calls and in-person meetings. Don’t give people easy outs

Meetings

  • Adjust the default assumption of meeting times. Change the default from 60 to 30 mins as the new “standard” time for meetings. A one-hour meeting with ten people is actually a ten-hour meeting, not a one-hour meeting. This simple change can lead to thousands of working hours saved in larger companies over the year
  • Define the end time for all meetings and phone calls. Make it clear in every way possible that your time is limited. Schedule something else afterward if you have to
  • Introduce a “no-meeting” day — adopted already by numerous organizations which has lead to significant improvements in productivity

Make Smarter Decisions in Life

Watch Less TV

  • Rearrange the furniture in your living room to not face the television. If you want to watch TV, you’ll need to move them
  • Remove the batteries from the remote so you need to walk up to the TV to turn it on and change channels or volume
  • Bonus points: leave a book where the remote normally was

Less Phone Time

  • Disable all notifications. All. Of. Them. If it’s truly urgent, people will call
  • Remove all infinity scrolling apps, such as social media and news
  • Turn off all sounds. Vibration is a sound too. Go to Settings → Sounds and turn off the “vibrate on silent” feature. Then scroll down and set all the sounds and vibration patterns to “None”, except for your ringtone
  • Always leave your phone in another room or in a drawer when working. Out of sight, out of mind
  • Move all apps to the second screen and keep your home screen empty. Now you have to form an intention to use a certain app and consciously swipe to the right and start it
  • Set your phone to airplane mode an hour before going to bed and only disable it after completing your morning routine. No more checking Facebook or immediately after waking up or just before going to sleep. As a bonus, flight mode saves battery life

Reduce Mindless Internet Browsing

  • Go cold turkey on your phone and disable the browser app. On the iPhone, go into Settings, turn “Restrictions” on and then you can turn off Safari. For Android, disable Chrome in App Settings
  • On the computer, start by removing infinity scrolling websites from your bookmarks bar and replace them with informative blogs and learning opportunities
  • Install StayFocusd, a chrome extension that lets you block specific websites for a set period of time. You add websites to your blacklist with a few simple clicks. If you want to go hardcore, use SelfControl to block websites for a specific time. You won’t be able to access those sites until the timer expires, even if you restart your computer or delete the application
  • Save articles to read later with the Evernote Web Clipper. Choose “Simplified article” and save it to a notebook (I call mine “Read Later”). Batch reading of those articles during your leisure time

Read More Books

  • Download Audible and always have one audiobook going for while you’re driving or on a walk
  • Download the Kindle app and always have one book going at a time
  • Instead of watching TV to fall asleep, read. Bonus: You’ll fall asleep faster since you’re not staring at a screen
  • Always have a book on the toilet so when you have to — uh, “go” — you’ll read instead of using your phone

There are a lot more nudges and defaults strategies that you can use to shape the environment around you. In the words of Winston Churchill:

“We shape our buildings; thereafter, our buildings shape us.”

Optimizing Other Defaults to Make Smarter Decisions

To make smarter decisions, your goal is to create “good by default” options. By doing so, you must consciously decide to make the choice to do bad.

To understand “good by default”, consider the towel washing service at hotels.

One has a sign saying: “Washing towels every day is bad for the environment. If you don’t want us to wash them, place them in your bed”. In other words, you must choose to do good. Most people either won’t bother or will forget.

Another hotel uses a different sign with an opposing message: Washing towels every day is bad for the environment. If you want us to wash them, place them in your bed”. Suddenly, not only is the default option the right thing to do for the planet, but you must actually choose to do bad.

In the first example, you had to actively choose to do good. But the game changes when both the path of least resistance is the right thing and you have to make a conscious choice to do something you know is unsustainable.

The same idea can be applied when designing your own defaults. If you haven’t got any bars of chocolate at home, you can’t eat them unless you consciously decide to go out and buy them. 9 out of 10 you won’t make that call.

Another key strategy is to simplify. More options aren’t better, it’s worse. It depletes your willpower and leads to decision fatigue. Keep your defaults as simple as possible: eat the same meals over and over again, read one blog post at a time instead of opening 10, own fewer things and love everything that you own.

As a rule of thumb: when in doubt, eliminate options.

Ultimately, designing for default is based on a simple premise: change your environment so that it’s easier to make smarter decisions and harder to perform bad behaviors.

Make Smarter Decisions Designed By You, Not For You

It’s very powerful to realize that most of your life was designed for you, but not by you. Social media end goal is to capture your time and attention. This is contrary to your end goal, which is to remove distractions in order to perform Deep Work.

That’s why you need to rethink all the defaults in your life and decide for yourself what the optimal choice is. Most of the times you can re-design defaults to work for you, instead of against youQuestion everything. Change your environment so it fits your goals and the way you want to live your life.

So what are you waiting for? Go on and change some defaults.


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