It happens. A decision looms and you hear a customer, or maybe even yourself, say “Let me sleep on it.” But, is this always the right response? It’s important to recognize that all decisions are time sensitive. And, the biggest risk in being slow to decide is having the decision taken out of your hands.
Our lives and jobs require us all to make decisions on a daily basis. And some decisions are, arguably, more important than others. So, when we came across this study on the effect of sleep on decisions in the Journal of Consumer Psychology, we wanted to share. Here’s a look at when to “sleep on it” versus becoming the poster child for the saying, “you snooze, you lose.”
Research shows when people care a great deal about an outcome, they often avoid making an immediate decision. And for really big decisions, temporary hesitation is not necessarily a bad thing. In fact, for complex problems, a period of distraction – where the decision at hand is not the focus – can actually have a positive effect on the outcome.
When we’re not aware of it, the brain takes part in a process known as unconscious thought. During this “down” time, the brain is automatically able to separate important from unimportant decision attributes and give more weight to the things that matter most. In short, work being done by the brain while the body is asleep can help a person determine their priorities and make decisions accordingly.
Many businesses know this and have incorporated “sleep on it” time to their decision-making processes to prevent such scenarios. For example, the SEC requires a “cooling off period” before a company can go public. Insurance companies often require a “waiting period” before coverage takes effect. Retailers offer “30-day return policies” that allow consumers to take merchandise home while they are thinking over their purchase.
Similarly, buying a home is a big deal – oftentimes one of the most impactful decisions you will make in your life. Luckily, in real estate, there are built-in safety mechanisms to ensure buyers make great decisions.
As we teach readers in Your First Home, real estate contracts in many states have subject-to or contingency clauses that prevent a contract from becoming firm and binding until the property is inspected, the title is searched and financing is approved. While every state’s laws are different, in Texas, it’s known as an option period. During this 7-day stretch, the buyer pays a fee for which she can cancel the contract for any reason without penalties.
These types of clauses basically afford buyers time. By putting down very little money upfront – usually only a few hundred dollars – Ms. Homebuyer gains much more than 24 hours for snooze time on the big-ticket decision.
As our risk management consultant Avis Wukasch tells us, states that have these procedures prevent a client from losing the chance to buy her dream home, while alleviating decision-making pressure with a “sleep on it” period.
It can be smart to build “think” time into decision making. We just recommend keeping sight on those decisions which need immediate attention and action, lest a great opportunity be lost while you are sleeping.