The truth about confidence: 4 steps to calibrate self-perception

You are a badass. Think and grow rich. The magic of thinking big.

These titles appear on the covers of some of the world’s most popular self-help books. Each one often tells readers: believe in yourself and achieve your dreams!

But how effective is confidence, really? And is more always better?

Don Moore, a researcher on confidence and decision-making at Haas Business School at the University of California, Berkeley, says conventional wisdom around confidence is often flat-out wrong.

“So many people actively pursue a strategy of trying to fool themselves into being more confident,” Moore tells Inverse. That’s because there's good reason to think that success is correlated with confidence, he explains.

“If the most capable and promising competitors in any domain also have a sense of how good they are, they will be more confident and they will be more likely to succeed,” Moore says. “Does that mean that you want to fool yourself into being more confident without actually getting better? No, that sounds like terrible advice.”

Confidence that doesn’t match reality or ability is just “delusion,” Moore adds.

Too much confidence can lead us to make choices that are destined to fail. Meanwhile, underconfidence can cause people to miss out on opportunities that might succeed.

"Too many people give up on what could have been promising careers and promising risky projects because they're too sure they have correctly estimated their own shortcomings," Moore says.

This week, Strategy explores how to avoid this fate and calibrate self-perception accurately to achieve perfect confidence.

I’m Ali Pattillo and this is Strategy, a series packed with actionable tips to help you make the most out of your life, career, and finances.

False confidence — According to Moore, confidence is all about your estimate of your abilities, your beliefs about how good you are relative to others, or your certainty in your knowledge.

Across the board, people aren't generally over- or underconfident. It depends on the context.

Most people think they look worse naked or are poorer writers than the average person. That's because they're comparing themselves to photoshopped models in magazines or writers featured in The New Yorker, Moore says. It’s all relative.

Moore has been studying this phenomenon for years and recently pinned a book summing up the existing body of evidence around confidence called, Perfectly Confident: How to Calibrate your Decisions Wisely.

"By and large, for most people, the most important influence on their confidence is reality," Moore explains.

Confident athletes are especially confident because they know they're good. More confident students are confident because they know they're capable.

Confidence and ability are generally positively correlated, not perfectly correlated, he adds. Oftentimes, people are not only overconfident or underconfident in their abilities, but overly certain of their estimates.

"It's really common for people to be too sure of themselves and all sorts of things, failing to consider ways in which they might be wrong," Moore says. “And when we’re experiencing a challenge or when we're not sure about others, we'll think that we're worse than others and be too sure of that fact."

Confidence does more than shape our thinking; it guides behavior. "Being overconfident leads to errors of commission where you will take risks, enter competitions, begin ventures, or start new products that wind up failing," Moore says.

"Meanwhile, underconfidence leads to errors of omission, where our fear leads us to shy away from competitions where we could have succeeded to avoid investments that would have paid off, and to be afraid of introducing ourselves to other people who could have turned into friends or lovers."

Calibrating confidence— Moore offers four ways to de-bias or discipline your confidence:

1. Measure ability: Seek evidence in quantified assessments of performance or probability, Moore suggests. This could be referencing a test score, race time, or feedback from coworkers as you calculate your confidence about a skill or project.

2. Talk to others: Often, bouncing your idea off another person can help bring you back down to earth. Poker players use this technique frequently. When one player makes a grandiose claim that others are skeptical of, others will often challenge them saying, "Want to bet?" Others' reactions can confirm or deny our confidence.

3. Get real: "Being forced to think in practical terms about the claim that you're making, and putting money into the beliefs that you profess, is a great way to discipline your confidence," Moore says. Put the filter of reality onto a potential idea and see if it looks differently.

4. Think in shades of gray: "To calibrate your confidence, it is enormously helpful to grow comfortable in the gray zone between 100 and zero percent," Moore says. In most scenarios, probabilities are in the middle of this range, not one or the other.

Ultimately, life's a confidence game. Our beliefs and predictions are constantly shifting based on reality, and in turn, shaping our decision-making.

Putting these tools to work can help us become "perfectly confident," as Moore puts it, and avoid missing the mark.