Travel Hacking: Experience More with a Risk Policy

This page may contain affiliate links. Please read our disclosure for more info.

Leaving our bikes parked by the dusty road, we walked through the well-tended garden up to the large wooden reception of the hot springs and enquired about prices. As usual, it was tiered pricing and given my colour—so brilliant white that the Dulux dog would weep into his paws—there was no way we were going to get the local rate.

“$8 each” said the receptionist.

$8! Wow! That was a lot for Myanmar—where a 3-dish meal and Chinese tea costs a single dollar—even with the expected Tourist Tax.

Then it began.

“Should we pay it?”
“What if it’s not that great? I mean, it looks pretty nice, but what if it’s not that hot?”
“Or too hot?”
“What if we only stay for 10 minutes?”
“What do you think?”
“I don’t know, what do you think?”
“It’s only $8 each.”
“Yeah, but on the other hand. It’s $8 each.”

And so on.

In the end, we went for it and spent a glorious 45 minutes soaking in the springs enjoying the spiffing view over countryside around Inle Lake.

However, with a simple strategy, we could have spent less time tortuously weighing the pros and cons and more time soaking our tired bones.

Hot Springs Inle LakeShortcuts to Thinking

The question “is it worth it?” looms large over many a traveller’s decision. We look to Trip Advisor and Lonely Planet for clues and turn to blogs and social networks for confirmation. We have a finite amount of time and cash and we need to spend it wisely.

But perhaps we’re being a little short sighted.

In Thinking Fast and Slow, Daniel Kahneman looks at the way we think.

It’s fascinatingly disheartening. Our brains are, basically, rubbish.

Sure, they’re still marvels of science and have put us on top of the evolutionary tree, but they require a lot of power (they’re 2% of our body mass but take 20% of the energy) and, in our efforts to save energy and become as lazy thinkers as possible, we take a lot of automated shortcuts in our thinking that, while beneficial in protecting us from bear attacks, aren’t so good when it comes to statistical analysis.

We are not, it seems, rational beings.

In the middle of all of this depressing news about how I’ll never even be aware that I’ve made a bad substitution (answering a different question than was asked); put importance on something just because it was easy to remember; limited a range of values because of previous exposure to a particular figure; or been persuaded one way or anther by automatic stereotypes, I was able to tease out a simple strategy that could help me make better, more rational decisions.

Risk Policies

We are affected by losses more than we are affected by gains. We like getting stuff but we really, really hate losing it. We hate losing it a whole lot more than we like gaining it.

This makes us risk averse, which is a perfectly fine strategy when you’re living in a cave where the wrong choice means getting eaten by a sabre tooth tiger. It’s not so great when you’re trying to maximise a travel experience, where a risk means wasting a day and a few dozen dollars.

A risk policy attempts to mitigate this powerful aversion to loss by posing the question in a broader frame then providing a simple answer to whether or not to take the gamble.

In the context of “should we dip our toes in the hot water?”, the risk that the $8 was worth it was embedded in a very narrow frame of ‘right now’, ‘expected local prices’ and ‘daily budget’ which makes it seem a much larger loss than if we framed it in the context of ‘our lifetime’ and ‘our total net worth’ (where the investment is trivial).

Unfortunately, the tendency of humans is to always frame things in a very narrow sense.

Having a risk policy overcomes this tendency by aggregating decisions over a long period of time, embedding a single risky choice (will this $8 activity be worth it?) in a larger pool of similar choices. Even if we make one or two bad choices where we feel ripped off or that our time has been wasted, the net experience gain is still very likely to be positive. We are also less likely to feel regret when things do go wrong.

A risk policy for travel activities like the above could look something like: “We say an automatic yes to any activity that takes less than a day and costs less than $20”.

As a bonus, according to Daniel Gilbert, this strategy is likely to make us happier, too. Too much choice is stressful and, whatever we decide, our brains will work hard to make it seem like the right choice, regardless of whether we spent an hour or 10 seconds deciding.

We all suffer from confirmation bias—may as well use it to our advantage.

Are you planning your next travel adventure? See our Travel Resources page for our favourite tools and gear to help you plan the perfect trip. 

  • Share:

Enter your email to sign up for our monthly newsletter and free ebook South America Highlights.


  1. Great, original post guys! These seemingly ‘petty’ decisions are ones that I can so relate to! As far as budgeting goes, I’m a big believer in the Seinfeild, or “even stevens” approach, as from experience I seem to be that way inclined (i.e win some, lose some). We have a daily budget, but have stopped recording every expense. Rather we try to keep accommodation low and are mindful of food bills, but the other stuff, if it’s something we want to do, we’ll do it. But like you, I was umming and aah-ing over something I want to do here in Chiang mai which is hugely overpriced (elephant nature park), before realizing it’s something I TRULY want to do. So I’m doing it :)


  2. You really have to find a happy medium between worrying about value-for-money and just being willing to pay for a great experience. But I know that’s something a lot of travelers (especially long-term travelers) worry about. We’re often so concerned with saving a dollar that we lose sight of the fact that, in the grand scheme of things, it’s just a dollar, and that the experience is probably worth it.

    I try not to fixate too much on my budget when I travel. Sure, I have one (I’m not lucky enough to have an infinite amount of money!), but if I come across an experience that really does seem like it’s worth my time and money, I try not to focus on the price tag too much.

    That said, splurging on every seemingly worthwhile experience is a great way to have to go home a lot sooner than you’d like. Again… happy meidum.


  3. Interesting stuff. It’s true that we’re not rational – although some of us are more rational than others! Sometimes I see people who can’t walk past a shop or street seller without buying something…


Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.