If you collect too much information for analyzing a decision, you can suffer from analysis paralysis, where you spend too much time thinking about a decision rather than making one. Recall a major financial decision you made recently, such as of a car or housing purchase or rental. Describe your process for making the decision. How could analysis paralysis have affected this process?

Decision making and problem-solving

I was tasked with a tough financial decision to make about purchasing a rental property worth $650 per month. The seller offered me three rental properties that were available for sale. One rental property was in the wrong street, the other one was in the wrong town, and the other had a small yard. Therefore, no property was perfect, but I had to make a tough decision. I settled for the one in the wrong street which was offered at $550 per month. It had the least price compared to the other two. Even though it was in the wrong street, it satisfied all the other features I was looking for. Buying this rental property would allow me to save $100 per month. So in a year, I will have saved 1200 dollars. With these savings, I will be able to look for another rental property in the future and make other investments. The other rental properties had were $650 each but had facts that I could not change. I could not replace the one that was in a wrong town; neither could I increase the size of the one with a small yard, which was one of my major priorities.  

Analysis paralysis would have affected my decision-making process if I decided that I will only settle for the perfect property with all the requirements I was looking for (Grenning, 2002). I would have been caught in a vicious cycle, waiting to buy the perfect property. I would have wasted years looking for the perfect property which would have cost even more than what I had. Furthermore, the future is uncertain, and there is no guarantee I would ever get what I was looking for and whether I could afford it in the future. Time is precious, and I had to act now to save for the future.  

References

Grenning, J. (2002). Planning poker or how to avoid analysis paralysis while release

Planning. Hawthorn Woods: Renaissance Software Consulting, 3, 22-23.