I Asked 40 Millionaires Their Biggest Regret

Daniel Berk (0:00)

I asked 40 millionaires a really simple question. What is your biggest regret? And at first, the answers looked completely random. $22,000 a year put into life insurance policy instead of Bitcoin.

$11 million of theoretical upside, gone. Tesla stock sold to pay for a wedding. Hundreds of bitcoins sold at $300 to make payroll. A chance to join what became one of the biggest companies in the world turned down because the idea sounded dumb.

And then there were answers that had absolutely nothing to do with money.

I should have had kids younger. I should have waited longer to have kids. I spent my health making money. I didn't trust myself. I cared too much about being liked. Withholding love. That was literally somebody's entire answer. Two words, withholding love. So I went through all 40 answers and then I went back through more than 100 conversations we've had on Moneywise. And eventually I realized there aren't actually 40 different regrets. There are basically three. I can see the life I almost had. I didn't become the person I thought I could become. And I thought I had more time. That's it. And this is where the episode got way more interesting to me. Because psychology has been studying these exact feelings for decades. Not just rich people, but regret. Why we have it. Why certain mistakes disappear and others bother you for 30 years. Why sometimes the person who did objectively better feels worse. Why the thing you didn't think you can do became more painful than the stupid thing you actually did. And there's even research suggesting regret has a job. Your brain isn't just torturing you for fun. It's trying to make sure you don't make the same mistake twice. What regret actually is, is crazy. First, there's an important difference between regret and disappointment. If it rains on your wedding day, you're disappointed. If you picked the outdoor venue after three people told you it was going to rain, now you regret it.

Because regret needs something a little bit extra. It needs an alternate version of reality. The actual thing that happened, but your brain can also see the other thing that could have happened. And crucially, you feel like your decision had something to do with which version you ended up getting. And there's actually a theory of regret called decision justification theory. The basic idea is that regret has two ingredients. One, the other outcome would have been better, and two, you blame your decision for not getting it. It's a nasty combination. I lost money hurts.

I lost money because of a choice I made that I now think was obviously stupid hurts differently. And we know this isn't just some figure of speech. In a 2004 study published in Science, researchers studied people with damage to part of their orbital frontal cortex. They put them through decision making tasks where they could see not only what happened with the option they chose, but what would have happened if they had chosen differently. Healthy participants experienced regret. The patients with orbital frontal damage didn't show the same experience of regret or anticipation of its consequences. Then another study put healthy people in an fMRI while they made gambling decisions. As people experienced more regret, activity increased in areas including the medial orbital frontal cortex, interior cingulate and hippocampus, which are three words I did not know how to say before this episode. But there's even more science that makes this all very cool. As the experiment went on, people started changing their decisions to avoid feeling regret again. The circuitry involved when they felt regret started showing up before the next decision, thus preventing them from making the same bad decision twice. In other words, regret isn't just you feeling bad about the past. Your brain is using the past to change your future. The science we're covering makes these 40 answers from these millionaires make a lot more sense as we start to pick them apart. Also really quickly, the reason I even have 40 people willing to answer this honestly is Hampton. It's a private community for founders. And when I say honestly, I mean these aren't LinkedIn answers. People in Hampton talk about their actual P&Ls, their actual net worth, companies falling apart, marriages falling apart, having new marriages, having babies, all the different challenges that come from being an entrepreneur while living life. It's one of the few places I could ask a room full of really successful people, what decision still bothers you and actually get good answers. And these answers are what led me down this entire rabbit hole. Okay, so Bucket One, I can see the life I almost had. This was the biggest pattern. And the easiest way to describe it is the counterfactual is painfully clear. All the investing answers are basically the same story. I owned the thing and sold it. I could have bought the thing and didn't. I thought I was smarter than the index. I listened to an advisor. I ignored Bitcoin. I ignored Bitcoin again and again. And apparently in one person's case, 17 separate times, the numbers are different. Psychologically, it's the exact same regret. I know what I did and I can see exactly what would have happened if I had done something else. The stock market is basically a regret calculator. Most decisions in life don't give you that. You have no idea what would have happened if you had gone to a different college. You don't know who you would have married if you hadn't met your wife or your husband. You don't know if the business you almost started would have been amazing or would have ruined your life because you never started it. But if you sold bitcoin at $300, well, you can open your phone and calculate very easily how much money you would have made if you hadn't sold. The alternate universe has a ticker symbol, and that can be brutal for people who are filled with regret. But there's an incredible study that shows us why. In 1995, researchers studied Olympic medalists. They looked at footage from the 1992 Olympics and had people rate how happy the athletes appeared. Bronze medalists look happier than silver medalists, which on the surface makes no real sense. Silver is better. They literally beat the bronze medalists. But the researchers explanation was counterfactual thinking. The silver medalist is standing there thinking, I almost got gold. One tiny thing changes and I'm the Olympic champion. But the bronze medalist has a different comparison. One tiny thing changes and I'm fourth. If I had gotten fourth, I would get nothing. It's the same Olympics, it's the same podium, but the silver medalist objectively did better and can still feel worse than the bronze medalist. Because regret doesn't care about what actually happens. It cares about what almost happened. Now think about selling Bitcoin at $300.