Reasonable over rational

The two big questions on the minds of parents with school age children this summer are...

• What’s this upcoming school year going to look like?

• How are you going to handle this upcoming school year?

If school opens in-person, will you send your kids? What about if it’s a combination of in-person and remote learning? Will you opt for full remote learning instead? And is remote learning even feasible if you’d also like to remain employed?

While I don’t have the answer, today I’d like to share a decision making process that you can apply when making big life decisions like this one.

“A good goal for your personal finances is to be reasonable, not rational.” – Morgan Housel

Morgan Housel, one of my favorite writers, introduced me to the concept of reasonable, not rational. Using his family as an example, Morgan shared how they decided to pay off their mortgage in their 30s. They knew full well at the time that it might not be the most rational decision. After all, they already had a good cash cushion and a low interest rate on their mortgage, which means they might have been better off financially investing that money. Yet when they wrote the check and paid off their mortgage, Morgan knew they had made the best decision for their family. The peace of mind they acquired by becoming debt-free was worth more than any financial gain they might have missed out on.

So what does this have to do with your school decision this year?

Remember that your decision won’t be rational so aim for reasonable instead.

Our decisions will never be 100% rational even if we try. We’re all emotional beings and it’s impossible not to let those emotions impact our decision making. Reasonable decisions, financial or otherwise, start by weighing all of our available options. We can then select the best option for us while accepting the tradeoffs that come with that choice.

It’s also important to remember that reasonable decisions are not about getting it right. Right or wrong is only knowable with the benefit of hindsight. Our goal is to make the best decision using what you know right now because that’s all we control.

Michelle and I will likely apply this same approach for our own school decisions this fall, just as we tend to do for all of our big life decisions. We’ve found it helps us move forward in the face of uncertainty and we certainly hope that it helps you do the same.

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