WEBVTT - Know the odds

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<v Speaker 1>Welcome to Before Breakfast, a production of iHeartRadio. Good Morning,

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<v Speaker 1>This is Laura. Welcome to the Before Breakfast podcast. Today's

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<v Speaker 1>tip is to know the odds. Having a good sense

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<v Speaker 1>of how likely something is can help you make better

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<v Speaker 1>choices and might also be reassuring if you tend to

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<v Speaker 1>fixate on unlikely events. A few months ago, I flew

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<v Speaker 1>to Japan for spring break with my sixteen year old son.

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<v Speaker 1>We had a great time there, but of course we

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<v Speaker 1>had to get there. Flying always makes me nervous. In particular,

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<v Speaker 1>I am nervous about flights getting canceled or being horribly delayed.

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<v Speaker 1>But the good news is that I had been tracking

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<v Speaker 1>this particular flight for a while and I saw that

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<v Speaker 1>it almost most always left on time. There were only

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<v Speaker 1>a few times when it had been delayed, and canceling

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<v Speaker 1>was extremely unlikely. This was good to know. Now you

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<v Speaker 1>can always get unlucky. Longtime listeners might recall my attempts

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<v Speaker 1>to get to Edinburgh a few years ago when United

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<v Speaker 1>canceled two days worth of flights in a row. But

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<v Speaker 1>when you see the on time record for a flight

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<v Speaker 1>and it is good, you can feel better about your

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<v Speaker 1>upcoming travel. Knowing the odds can be helpful in all

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<v Speaker 1>sorts of circumstances. For instance, I know a lot of

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<v Speaker 1>my listeners save and invest for retirement. I find it

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<v Speaker 1>helpful to know that in the US market corrections of

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<v Speaker 1>ten percent are quite common. If that happens, it is

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<v Speaker 1>truly no big deal and nothing to panic over. Twenty

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<v Speaker 1>percent drops are less common, but also still not uncommon.

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<v Speaker 1>They happen one to two times every five years on average. Again,

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<v Speaker 1>no need to get upset about it. Drops of twenty

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<v Speaker 1>five percent or more are much less common. There have

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<v Speaker 1>only been a handful of drops of thirty percent or

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<v Speaker 1>more over the past several decades. Now, that doesn't mean

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<v Speaker 1>it won't happen and that the market won't be sideways

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<v Speaker 1>for a while. But when you know the odds, you

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<v Speaker 1>can see that the average dip of ten to twenty

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<v Speaker 1>percent doesn't turn into a full scale sell off. You

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<v Speaker 1>can sit tight and you don't need to think a

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<v Speaker 1>much about it. You might even find it helpful to

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<v Speaker 1>know weather percentages. If you are planning an outdoor wedding,

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<v Speaker 1>it's good to have a plan for rain, but you

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<v Speaker 1>can also take comfort if you are having the event

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<v Speaker 1>somewhere where it tends to only rain, let's say three

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<v Speaker 1>days a month during the month you are having the event. Yes,

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<v Speaker 1>make a backup plan, but the odds are good that

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<v Speaker 1>you won't have to use it. Knowing the odds can

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<v Speaker 1>be reassuring, but it can also help you make more

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<v Speaker 1>informed choices. If I'm trying to get to an event

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<v Speaker 1>and I'm looking at flights that leave close to the

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<v Speaker 1>same time, it's helpful to know. If one has an

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<v Speaker 1>on time percentage of ninety percent and the other is

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<v Speaker 1>more like seventy five percent, probably best to go with

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<v Speaker 1>the ninety percent one. There aren't always odds available, but

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<v Speaker 1>in many cases there are. Historic flight data is often

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<v Speaker 1>available if you search. One of the fascinating things about

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<v Speaker 1>modern life is that there are prediction markets, and you

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<v Speaker 1>can look at those. You can also seek out any

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<v Speaker 1>historical data you can find, or talk to people who've

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<v Speaker 1>done something recently. Anecdotes aren't data, of course, but sometimes

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<v Speaker 1>they are helpful. If your neighbor has had bad luck

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<v Speaker 1>with a certain car and then you look it up

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<v Speaker 1>and see that can numer reports reads it as likely

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<v Speaker 1>to have problems, well, that is good to know. Maybe

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<v Speaker 1>you can look into other brands and save yourself some trouble.

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<v Speaker 1>In the meantime, This is Laura. Thanks for listening, and

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<v Speaker 1>here's to making the most of our time. Thanks for

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<v Speaker 1>listening to Before Breakfast. If you've got questions, ideas, or feedback,

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<v Speaker 1>you can reach me at Laura at Laura vandercam dot com.

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<v Speaker 1>Before Breakfast is a production of iHeartMedia. For more podcasts

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<v Speaker 1>from iHeartMedia, please visit the iHeartRadio app, Apple Podcasts, or

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