Jeff Bezos Says All Decisions Are ‘Type 1’ or ‘Type 2’: Here’s How To Apply This to Your Finances

Core Insights - A Pew Research study indicates that only 52% of individuals feel confident in their personal finance knowledge, highlighting a widespread struggle with financial decision-making [1] Group 1: Types of Decisions - Jeff Bezos categorizes decisions into two types: Type 1 and Type 2, which can be applied to financial choices [2] - Type 1 decisions are characterized as "one-way doors," meaning they are consequential and nearly irreversible, requiring careful planning and consultation [3] - Type 2 decisions are "two-way doors," which have reversible consequences and do not necessitate extensive deliberation, although they should still be made with consideration [3] Group 2: Application to Financial Decisions - Type 1 financial decisions include significant commitments such as purchasing a home, which involves long-term implications and requires thorough preparation [3][4] - Factors to consider for Type 1 decisions include comparing mortgage lenders, checking credit scores, and ensuring affordability of loan payments, which may involve substantial time and resources [4]