How to Improve Your Judgement

Rahul Chakraborty
5 min readOct 7, 2021


Improving judgement is not only critical for you to generate wealth, it is also a pivotal skill to cultivate in order to live a life to maximize your pay offs and to minimize your mistakes. It’s hard to emphasize just how important judgement is in today’s world of cut throat competition. If you own a business and want to beat your competition, you’ve got to be more precise with your judgement than your competitors.

Even if your judgement is 10% more accurate than your competitors, the pay off will compound over years and translate into millions of dollars worth of additional revenue. Of course, the pay off will depend upon the size of your business and the competition surrounding it, but the basic principle will always remain the same.

Good judgement is what makes or breaks businesses. Good judgement is also what determines the level of wealth you’re able to generate over your lifetime. In a world where automation has killed millions of jobs, the ability to make good judgement remains an extraordinarily elusive skill. To be paid for your judgement is the ultimate pipe dream. So how do you actually improve your judgement?

There is no one easy, fit for all answer to this question. Some people are born with the ability to make decisions that are more accurate, while others aren’t. But I genuinely believe that good judgement is a skill just like any other and can be cultivated with time and practice. Some of the best ways to improve your judgement can be found below -

1. Reading: The greatest thinkers in the world invariably are the most fervent readers. We tend to think of our brain as the organ that is separate from other body parts, because it is the arbiter of consciousness. But just like you need to work out at the gym to build your muscles, you also need to perform mental gymnastics to improve the way your mind functions. Our brains have evolved to be distracted, so naturally reading is something that it hates doing. But you shouldn’t go out of the way to force yourself to read books. Rather focus on reading books that you actually enjoy and scale up from there. There is a wonderful quote by Naval Ravikant that sums up what I’m trying to convey here, “Read what you love until you love to read”

2. Writing: Reading is only half the battle, because much of what we read, we also forget. While the purpose of reading isn’t necessarily to retain all the knowledge that you’re able to consume, you should still be able to retain the core ideas that a book postulates. Writing is the most effective way of doing that. When taking notes from a book, it doesn’t have to be structured. You can always revisit the notes you took while reading a book and then structure them in a way that makes for a more intelligent reading. There are very few habits in the world that can bring about the kind of clarity to your thought process as writing.

3. Meditate: Making good decisions inevitably means stripping yourself from all the biases that might be clouding your judgement. We are fallible creatures who are deeply emotional by nature. Our emotions are often the biggest bottlenecks when it comes to making rational choices. If you pick up any random book on behavioral economics, a quick summary of the book will reveal just how irrational we are. The most common form of bias that we constantly find ourselves being swamped by, without even realizing it, is confirmation bias.

Confirmation bias can be best characterized as our proclivity to actively seek information that is consistent with our already existing beliefs or opinions. Confirmation bias is what distracts us from discovering the truth, because it is in our nature to want to be vindicated, and looking for information that discredits your beliefs is not something the average mind is adequately trained to do.

This is why gaining mastery over your emotions is so critical in building good judgement. And meditation is the best tool in your arsenal to gain freedom from your thoughts and emotions.

4. Use First Principles Thinking: The basic premise of first principles thinking is to break things down to its most fundamental truths and reason up from there. Elon Musk is a huge proponent of this form of thinking. If you’re ever confronted with a complex problem, the best approach often is to break the problem down to its most fundamental bits and try to understand all the cogs that make up the machine. Musk used this framework to build his own rocket manufacturing company, SpaceX, which has brought down the cost of manufacturing rockets by over 300%. When Musk was told how expensive it was to build rockets, he broke rocket manufacturing down to its most fundamental parts, analyzing how much each part was going to cost, if there was an alternative in the market to how those materials were procured, and how all those parts could be assembled in the most efficient manner possible. This form of thinking will help you strike at the root of every complex problem that you’re confronted with, and help you make better decisions.

5. Learn the core 5 subjects: Everyone who wants to be successful in the business world must have a really good understanding of what I define as the core 5 subjects. Game Theory, Psychology, Statistics & Probability, Basic Math & Micro economics are the core 5 subjects that I think everyone should consider learning seriously, because a lot of it is applicable when it comes to rational decision making. A person who makes the best decisions is usually the one who is exposed to the broadest range of ideas. You need to know game theory in order for you to be a lot more strategic in how you approach your competition. Without a deep understanding of what game theory is, you wouldn’t know how to make the most optimal choices to maximize your payoffs.

Psychology is a foundational subject to gain a deeper understanding of how the human mind works. Given that you will be working with people in order for you to have any meaningful impact in the world, a good understanding of what drives people, the core motivations that make them tick, and being aware of the emotional states of people who you might be working with is as critical a skill as I can imagine. You cannot succeed in the world of business unless you know how to make your team happy, and psychology is the gateway to gaining a deeper understanding of human nature.

The world is infested with an infinite amount of data, but it can be very easy to be fooled by it. Statistics can always be bent in one direction to favour a certain narrative over another. We see this pattern of misrepresentation of data repeated over and over again on the news where one side of the political spectrum tries to gain the upper hand on the other by skewing the statistics to favour their own agendas. Given that statistics can be incredibly misleading, it is very important for you to be trained in basic statistics in order for you to make decisions that are based on objective reality rather than a skewed one.

Basic Math & Microeconomics are the bedrock on which much of our modern world is built. Math skills are incredibly important in understanding basic reports related to your business. By math, I don’t mean you need to be darting through a parchment with insane accuracy about calculus formulas. Basic arithmetic skills like algebra, percentages & probability are very important in understanding how the world works.