Lessons from "Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts" by Annie Duke

What if I told you that everything you know about decision-making is a lie? 

We love to believe that good choices lead to good outcomes and bad choices lead to disaster. But that’s an illusion. Life doesn’t work like a math equation where the right inputs guarantee the right answer. It’s a poker game—messy, unpredictable, ruled by luck just as much as skill.

Think about it. A reckless gambler can hit the jackpot, while a disciplined investor makes little. A CEO can make a brilliant strategic move and still watch their company collapse. A surgeon can perform a flawless operation, only for the patient to never wake up. So, were these good decisions with bad outcomes? Or bad decisions with lucky breaks?

In Thinking in Bets, Annie Duke reveals a truth that most people refuse to accept: you don’t control outcomes—you only control the quality of your decisions.

If that sounds unsettling, good. Because the way most of us make decisions is broken. We assume we know more than we do. We judge ourselves based on hindsight. We confuse luck with skill, certainty with confidence. And worst of all? We rarely stop to ask: What if I’m wrong?

But here’s the good news—there’s a way out of this mental trap. If you can learn to think in bets, to embrace uncertainty, to play the long game instead of chasing instant validation, you can radically improve the way you navigate life’s toughest choices.

Every day, you make hundreds of decisions. Some big, some small. Should you switch jobs? Invest in that stock? Move to a new city? Order takeout or cook at home? But here’s the real question: How do you know if you made the right choice?

Most of us judge our decisions by one thing—the outcome. If things go well, we assume we made a great call. If things go badly, we tell ourselves we screwed up. But here’s the catch: outcomes lie to us.

Imagine You’re at a casino, sitting at the blackjack table. You hit on 16. The dealer flips a 10 and bursts. You win. Was it a smart move? Yes. But what if you lost? Would it have suddenly become a dumb decision? The truth is, a good decision isn’t always rewarded, and a bad decision isn’t always punished.

A startup founder takes a huge risk—quitting their job, betting everything on a new idea. The company takes off, and suddenly, they’re hailed as a visionary genius. But what if the market had shifted slightly? What if an investor had pulled out last minute? The exact same decision could have ended in failure, and that same founder would have been called reckless and naive.

Or take a doctor who follows all the right protocols, makes a careful diagnosis, and prescribes the best treatment available. But the patient doesn’t make it. Did the doctor make a mistake? Or was it just an outcome they couldn’t control?

We call this resulting—the human tendency to judge decisions by their results rather than their quality. It’s a mental shortcut, but it’s dangerous. It makes us superstitious. It makes us overconfident when things go well and unfairly self-critical when they don’t. Worst of all, it stops us from actually learning.

Think about it. If a bad decision leads to a good result, do you really stop to question whether you got lucky? If a great decision leads to failure, do you reflect on what you did right, or do you just tell yourself you should have never tried?

We crave certainty. We want to believe that if we just think hard enough, analyze every possibility, we can guarantee success. But the world doesn’t work that way. It’s messy. Unpredictable. Every decision you make is a bet on an uncertain future.

Are you playing the game wisely? Or are you just letting the cards fall where they may?

Imagine you’re standing at a crossroads, two paths stretching out before you. One promises success, the other, failure. If only life worked that way. If only every choice came with a clear, neon sign pointing to the right answer. But in reality, the world is foggy, unpredictable, and full of hidden variables.

That’s why the smartest decision-makers don’t think in terms of right or wrong. They think in bets.

Because every decision you make—whether it’s launching a business, choosing a partner, or even ordering from a new restaurant—isn’t a guarantee. It’s a wager. A calculated risk based on the information you have at the time.

Let’s test this out.

Say you’re considering a job offer at a promising startup. The salary is solid, the culture seems great, but the company is new. It could either skyrocket or collapse in two years. What do you do? Most people try to make the "right" choice, as if that’s something you can know in advance. But a better approach? Assign probabilities.

Instead of asking, Is this the right decision? ask:

• What are the chances this company succeeds?

• What are the chances I gain valuable experience even if it fails?

• What are the odds I regret not taking this risk?

Now, you’re thinking like a poker player.

In poker, you never have all the information. You don’t know what cards your opponents are holding. You don’t know what’s coming next. But great players don’t let that stop them—they make the best possible decision with the odds they have.

Real-life decision-making works the same way. The trick is not to aim for certainty, but to improve your ability to bet wisely on the unknown.

Warren Buffett—one of the greatest investors of all time. He doesn’t look for guaranteed wins because there’s no such thing. Instead, he plays the long game. He places bets where the probability of long-term success is higher than the risk of loss. And over time, that discipline compounds into massive results.

But most people don’t think this way. They chase guarantees. They overvalue immediate outcomes. They panic when things don’t go as expected.

But if you can shift your mindset—if you can stop demanding certainty and start treating every choice as a strategic bet—you’ll gain something far more powerful: the ability to make consistently better decisions over time, no matter the outcome.

So the next time you’re faced with a tough decision, stop asking, What’s the right choice? Instead, ask yourself: What’s the smartest bet I can make with the information I have?

Imagine you're a detective investigating a crime. You walk into a room, and your gut immediately tells you who did it. You don’t have all the evidence, but something just feels right. So, you start collecting clues—not to find the truth, but to prove that your initial instinct was correct.

This isn’t just a bad detective movie. This is how most of us make decisions, without even realizing it.

Our brains are wired to take mental shortcuts. It saves time, reduces effort, and helps us navigate the world quickly. But these shortcuts—known as cognitive biases—also distort reality, making us dangerously overconfident in our decisions.

Think about the last time you had a strong opinion on something—politics, diet, investing. Did you actively seek out opposing views? Or did you instinctively gravitate toward articles, videos, and experts that reinforced what you already believed?

That’s confirmation bias. Instead of searching for the truth, we search for validation. And in decision-making, that’s a recipe for disaster.

For instance, A CEO is convinced their new product will be a hit. Instead of testing different perspectives, they cherry-pick data that supports their vision—ignoring warning signs that customers actually hate it. Millions are lost. Not because of bad luck, but because of a bad mental filter.

Here’s a simple question: Are you an above-average driver?

If you said yes, you’re not alone—over 80% of people think they’re better than the average driver, which, mathematically, is impossible. This is overconfidence bias: the illusion that we’re more skilled, more knowledgeable, and more accurate in our predictions than we actually are.

This bias ruins decision-making because it blinds us to uncertainty. Investors bet their life savings on stocks they just know will rise. Entrepreneurs ignore risks because they’re sure they’ll beat the odds. And poker players? They go all in on a weak hand, convinced their opponent is bluffing.

Overconfidence turns what should be a calculated bet into reckless gambling.

Ever hear someone say, I knew that was going to happen—after it already happened? That’s hindsight bias.

Hindsight bias tricks us into believing that past events were predictable, even when they weren’t. It makes us rewrite history in our heads, convincing ourselves that we always saw it coming.

For example: The 2008 financial crash. After it happened, everyone suddenly claimed it was obvious. But before it happened? Only a handful of people saw the warning signs. Hindsight bias creates the illusion that the past was clear, making us overconfident about predicting the future.

So, How Do You Outsmart Your Own Brain?

Before making a big decision, pause and ask yourself: Am I looking at this objectively, or just reinforcing what I already want to believe?

If you’re convinced you’re right, find the smartest argument against your position.

Instead of saying, I know this will happen, say, There’s a 70% chance this will happen, but a 30% chance it won’t. That shift alone forces you to think more rationally.

Learn from real mistakes, not just bad outcomes. Was your decision bad, or were you just unlucky? There’s a difference.

Cognitive biases make us feel certain when we shouldn’t be. They give us the illusion of knowledge, the illusion of control, and the illusion of foresight. But great decision-makers? They don’t trust their first instinct. They don’t assume they’re right.

Instead, they do what most people never will: they question their own thinking.

And, how do you Improve Decision-Making?

Imagine you’re standing in a dark room, searching for the right door to exit. You don’t have a flashlight. You can’t see what’s ahead. But you have two choices: you can either make a random guess and hope for the best… or you can take slow, measured steps, testing each handle, gathering clues, and improving your odds with every move.

Most people make decisions like the first option—rushing, guessing, hoping. But the best decision-makers? They operate like the second. They follow a process, refining their thinking step by step, stacking the odds in their favor.

So how do you do the same? How do you stop making decisions based on gut feelings and start making them like a professional?

We love to feel informed. But here’s the paradox: more information doesn’t always lead to better decisions—only the right information does.

Think of an investor. They can analyze market trends for years, read every report, watch every interview… and still make a bad bet. Why? Because data alone isn’t enough—you need to know what matters.

Instead of drowning in details, ask:

• What is the single most important piece of information I need?

• What is my biggest assumption—and what would prove it wrong?

• Is there a critical blind spot I’m ignoring?

More knowledge is good. But precision beats volume.

Most people approach decisions as if they’re black and white: Should I take the job? Should I invest? Should I take the risk? But smart decision-makers don’t think in yes-or-no terms. They think in percentages.

Instead of asking, Is this the right choice? ask:

• What are the odds this works out?

• What are the risks, and what’s my margin of safety?

• If I had to bet my own money on this decision, what probability would I assign to success?

When you force yourself to put numbers on uncertainty, you remove illusions and replace them with realistic expectations.

Here’s another hard truth: your brain is lying to you.

We already talked about cognitive biases, and the reality is, you can’t always trust yourself to think objectively. That’s why great decision-makers don’t work in isolation—they build decision groups.

• Poker players analyze their plays with other professionals.

• Investors debate their bets with other investors.

• Elite military strategists run simulations to challenge their own assumptions.

You need people who will challenge your thinking, call out your blind spots, and force you to justify your reasoning.

Before making a big decision, ask:

• Who is the smartest, most objective person I know?

• What would they say about this choice?

• Can I explain my reasoning well enough to convince a skeptic?

The more diverse your feedback, the sharper your decision-making becomes.

Most people only think about their decisions after they see the outcome. But what if you could look ahead—and anticipate mistakes before they happen?

Two techniques can do just that:

• Backcasting: Imagine it’s the future, and your decision was a massive success. Now, work backward—what specific steps got you there? What key factors made it work?

• Premortem: Now do the opposite. Imagine it’s the future, and your decision completely failed. What went wrong? What did you overlook? What would you do differently if you could go back in time?

These methods force you to identify risks, refine your strategy, and adjust before it’s too late.

Here’s the truth: there is no such thing as a perfect decision.

Even the smartest choice carries risk. Even the best strategy won’t guarantee success. But waiting for certainty is just another way of avoiding action.

Great decision-makers don’t try to eliminate uncertainty. They learn to live with it.

So instead of asking, Will this work? ask:

• What’s the worst-case scenario, and can I survive it?

• What’s the best-case scenario, and is it worth the risk?

• What’s my next move if things don’t go as planned?

Decisions aren’t about guarantees—they’re about managing risk wisely.

Every choice you make is a bet. Some will win. Some will lose. But if you follow this process—gather the right data, assign probabilities, seek outside perspectives, anticipate failure, and embrace uncertainty—you’ll start stacking the odds in your favor.

That’s how you stop playing life like a gambler… and start playing it like a master strategist.

Most people assume that making smarter decisions is about intelligence—about knowing more, reading more, thinking harder. But that’s not true.

Because every day, your brain is bombarded with noise—biases, emotions, misinformation, overconfidence. The difference between average thinkers and elite decision-makers isn’t just what they know, but how they structure their thinking.

How many times have you agonized over a decision, paralyzed by the fear of making the wrong choice?

Here’s another truth: most decisions aren’t final.

Jeff Bezos popularized the idea of two-way doors versus one-way doors. A one-way door is a decision you can’t easily reverse—selling a company, getting surgery, having kids. A two-way door is a decision you can undo if things don’t work out—trying a new marketing strategy, testing a side business, hiring someone on probation.

Before overthinking a decision, ask:

• Is this a one-way or a two-way door?

• If I get this wrong, how easy is it to course-correct?

• If it’s reversible, why am I hesitating?

Most decisions aren’t as permanent as we think. Stop treating every choice like life or death.

Most bad decisions happen because we let emotions hijack our thinking. Anger, excitement, fear—they make us impulsive, reactive.

So here’s a simple trick: zoom out in time.

Before making a choice, ask yourself:

• How will I feel about this decision in 10 minutes?

• How will I feel about it in 10 months?

• How will I feel about it in 10 years?

This forces your brain to move beyond the immediate emotion and consider long-term consequences.

• Feeling like quitting your job because of a bad day? 10 minutes from now, you’ll still be mad. But in 10 months? That rash decision could cost you an opportunity.

• Tempted to skip a workout? In 10 minutes, you’ll feel fine. But in 10 months, you’ll regret every skipped session.

This method cuts through emotional noise and forces clarity.

We’ve all been guilty of overconfidence. We assume we know something—how a meeting will go, whether a business will succeed, whether someone will like us.

But here’s the trick: don’t just think you’re right—force yourself to bet on it.

Next time you’re sure about something, ask:

• Would I bet $100 that I’m right?

• What odds would I give myself? 80%? 50%? 20%?

• What information would make me change my bet?

This forces you to confront uncertainty head-on. Instead of blindly trusting your gut, you’re acknowledging doubt, considering alternative perspectives, and thinking in probabilities.

Smart thinkers don’t just believe—they bet.

Most people only think about why their decision will work. They get excited. They visualize success. They ignore warning signs.

The best decision-makers? They play devil’s advocate—hard.

If you’re making a big bet—starting a business, launching a product, making an investment—try this: pretend you’re your own worst enemy.

• If your decision were guaranteed to fail, what would cause it?

• What weaknesses are you ignoring?

• If a competitor wanted to destroy your plan, how would they do it?

CEOs do this all the time. It’s called a pre-mortem—analyzing why something could fail before it happens.

If your decision still holds up after this exercise? You’ve just pressure-tested it harder than 99% of people ever will.

Most people stop thinking too soon. They accept surface-level answers and move on. But deep thinkers? They interrogate reality.

Why did I fail this test? – Because I didn’t study enough.

Why didn’t I study enough? – Because I procrastinated.

Why did I procrastinate? – Because I felt overwhelmed.

Why did I feel overwhelmed? – Because I didn’t have a study plan.

Why didn’t I have a study plan? – Because I never made one in the first place.

Now you’re at the real root of the problem—not just the symptom.

Use this anytime you face a tough decision or problem. The first answer is rarely the real answer. Keep asking why until you get to the core.

Every decision you make is a bet. Some bets are small—what to eat for lunch, which movie to watch. Others are massive—changing careers, starting a business, choosing a life partner. But the truth is, no matter how much you analyze, no matter how much information you gather, you will never have all the facts.

And that’s where most people go wrong. They chase certainty. They wait for the “perfect” decision, the one with zero risks, zero doubts, zero unknowns. But that decision? It doesn’t exist.

The difference between amateurs and elite decision-makers isn’t intelligence. It’s not luck. It’s how they think.

They don’t judge their choices by outcomes alone—they separate skill from luck. They don’t fall for biases—they challenge their own thinking. They don’t make decisions based on feelings alone—they think in probabilities, they anticipate failure, they test their assumptions before acting.

So, stop thinking in right vs. wrong. Instead, think in probabilities. No decision is 100% certain—your goal is to make the smartest bet with the information you have.

Don’t judge your decisions by their results. A bad outcome doesn’t mean you made the wrong choice, and a good outcome doesn’t mean you made a smart one. Look at your process. Was it rational? Was it well-informed? That’s what matters.

Challenge your own thinking. Your brain is full of biases. You will overestimate your knowledge. You will ignore data that contradicts what you want to believe. Fight that instinct. Seek out opposing views. Pressure-test your decisions.

Make reversibility your advantage. Not every choice is final. If a decision is reversible, stop hesitating. Make the bet, gather real feedback, and adjust if needed.

Be willing to be wrong. The best decision-makers aren’t the ones who are always right—they’re the ones who admit when they’re wrong and correct course faster than everyone else.

You are not in control of outcomes. You are only in control of your process.

And if you can refine your process—if you can master the ability to think in bets—you won’t just make better decisions. You’ll start seeing the world completely differently.

Because life isn’t about knowing the future. It’s about playing the odds better than anyone else.