Pillow Test: Can You Sleep If It Goes Right?

Pillow Test: Can You Sleep If It Goes Right?

Most people, before a big decision, ask what happens if this goes wrong. Almost nobody asks what happens if it goes right.

I was recently on a fun podcast talking about the financial services industry, and one of the nuggets I shared was how I like to think about big decisions. I call it my pillow test. Before I commit to something, the question is simple: will I be able to sleep at night? There are two sides to that coin, and I believe most people don’t think through them both as much as they should.

The Questions In The Pillow Test

The first side is easy. What happens if this goes wrong? We are risk averse creatures and we feel pain about twice as much as we experience joy. So most of us run the failure calculation almost automatically. You come to grips with the odds, grieve a little of it upfront, and brace for the possibility. In most instances this side is rather easy to work through.

The other side of the coin is the one I find far more interesting. What happens if this goes right? If it works, can I live with the decision? How does this change things, and am I okay with the new normal on the backside if it goes exactly as planned?

I know, at the surface level it sounds silly. Of course you want it to go right. That’s the entire reason you’re doing it, right? To get a positive outcome. Why wouldn’t you want it to go right? But look deeper on this side of the coin. How does this change things? If this goes right, what are you giving up? What compromises will you have to make, and are you comfortable with them?

An Example

Let me give you an example. You’re making good money and riding the corporate roller coaster. Your boss’s position just opened up, and it’s a big global role. You’re a front runner, they’re taking applicants, and you know you can do the job. You’ve been groomed for this for years and you care about the company.

The negative side is easy. You apply and you don’t get it. In that circumstance you’re annoyed, you probably go home and yell to your spouse, and you spend a few weeks butt hurt. That’s the side that’s simple to figure out.

Now let’s flip the coin and look at the “positive” outcome. You get the job. It comes with a 25% income bump and a sizeable equity award. You’re in the inner circle of your company and highly respected. No brainer, right?

Well, let me keep going. The job demands you work most nights and one day on the weekend. You go from quarterly travel for a few days to being away from your family Monday through Thursday every week. You can no longer coach your son’s baseball team or assistant coach your daughter’s volleyball team. You skip the weekly tennis match with the guys. And you’ll need to hire a nanny to shuttle the kids around and help your spouse carry the family duties.

Now I ask you, is it such a no brainer?

I’ve watched this play out with clients more times than I can count. Here’s the part that stays with me. The ones who said yes to the first big job often got offered the next one a couple of years later. And in that second conversation, with a bigger number on the table, they’d finally say out loud what they’d known for a while: they never should have taken the first one. It took the second decision to see the first one clearly. The math on both had been obvious. The math is almost always obvious. That was the problem.

Go Through Both Outcomes

So here’s how I score it. You have to be able to sleep with both outcomes. If the downside keeps you up, that’s a no, and everybody understands that one. If the upside keeps you up, that’s also a no, and that’s the one people talk themselves out of. A no on either side is a no.

To be clear, this isn’t an argument for turning down the job. Plenty of people run this test honestly and say yes, and they walk in with their eyes open, which is exactly the point. It’s very hard to say no, and it’s very admirable to say no when you’re following your heart. But it’s just as valuable to say yes knowing precisely what it costs.

The goal was never to talk yourself out of good things. It’s to know what you’re trading before you trade it, instead of finding out on the other side. For me that’s what this pillow test has been, and I learned it from some great mentors I’ve been lucky to be around in my career.

Stay wealthy, healthy, and happy.