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Are we spoiled with too many choices?

We have endless options as consumers. It seems as if this would be a good thing. In reality, though, too many choices leave us anxious and unable to decide, according to Gary Belsky and Thomas Gilovich, the authors of Why Smart People Make Big Money Mistakes and How to Correct Them. Apparently, "choice conflict" is a major contributor to financial mistakes: The more good options we have, the less likely we are to make a confident choice.

To avoid mistakes when making a purchase, the authors say, we must first limit our choices by asking someone with expertise to narrow the field and recommend just three options. If your nephew is tech-savvy with an interest in photography, he's your go-to guy to pick camera options. You can also look to independent rating services, like Consumer Reports, and start with their top three choices.

To ensure the choice is made in a reasonable time, set a deadline for your decision. Asking someone else to pick the deadline for you is more effective than picking it for yourself: Accountability is a strong motivator to get something done and make a financial decision. After you've made your choice, ask a friend or your selected expert what they think of your decision-making process – not just your choice.

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According to Mr. Belsky and Mr. Gilovich, the less knowledge we have about a subject, the more likely we are to pay attention to information that really doesn't matter, like putting more weight on aesthetics over capabilities. Talking through your thought process will ensure you make a major purchase for the right reasons and feel confident in your final choice.

Angela Self is one of the founders of the Smart Cookies money group. Read her weekly column on managing debt and saving money at

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