Humans have a bad habit of making assumptions. Assumptions are, by definition, the act of accepting a truth without definitive proof. A habit of making assumptions is a bad one because it can lead to unexpected consequences, oftentimes bad ones that cost you not only time but money.
In my five year study of the daily habits of the rich and poor (Rich Habits Study), 56% of the rich and 72% of the poor in my study engaged in the bad habit of making False Assumptions. This one data point initially slipped through the cracks because there didn’t seem, to me, to be enough of a difference between the rich and the poor when it came to making assumptions. But when I drilled deeper, I made an important discovery. Out of the 233 rich people in my study, 177 were self-made millionaires. Forty-one percent came from poor households and the rest from middle-class households. In this self-made group of millionaires, only 43% of the self-made millionaires had this False Assumption habit. Why?
Sixty-seven percent of the self-made millionaires in my study were entrepreneurs, or individuals who were pursuing some dream, purpose, calling or big goal in life. As a result of their past experience in making assumptions, they learned that many of their assumptions were dead wrong. They found out the hard way that making false assumptions leads to mistakes that cost them time and money. Time is one thing, but money is a precious commodity to budding entrepreneurs and they need every dollar. They simply cannot afford to lose too much money. Successful entrepreneurs figure out along their journey that making false assumptions can put them out of business quickly. So, the smart ones, the ones who become self-made millionaires, learn to avoid making false assumptions.
I found in my research that individuals make false assumptions in one of four ways:
- You do not ask enough questions or
- You do not ask enough of the right questions or
- You don’t seek feedback from experts in your industry or
- If you do seek feedback, you dismiss it and simply do what you want.
There’s a narrative out there that all entrepreneurs go with their gut, or their intuition, when making decisions. Because of this misleading perception, entrepreneurs are viewed by most as bold and daring. That may be true of unsuccessful entrepreneurs, but I discovered it wasn’t true of successful entrepreneurs – the ones who go on to become self-made millionaires.
Self-made millionaires do not make important decisions until they have evaluated all of the feedback they receive from many different sources. Then they weigh that feedback. Feedback from industry experts obviously carries more weight than feedback from non-experts. Seeking feedback from others, prior to making any important decision, is a firewall against making a false assumption.