Wanna learn how to travel hack like an actuary on FIRE? I betcha!
Wanna learn the secrets of credit card travel rewards, and how to maximize the value of those travel points? Yeah?
Well, this ain’t the place.
There are dozens and dozens of sites that can help you with travel hacking with credit cards and I’ve got nothing to add there. I’ve dabbled in that area, but as you should know by now, I like to do things differently. So let’s paddle this canoe of travel hackability up a different creek.
Have you read the special conditions for reading this blog?
Travel Hacking and Where to Sit?
When you fly where do you like to sit? I’m a tall guy and so extra legroom for me is a must. I don’t know anybody that requests a middle seat, but for me, I would even go with a middle seat if it meant space to stretch out. My secondary consideration to extra space would be a seat close to the front of the plane; I need to get off that sucker in a hurry!
But, if you were to ask my mother, she would insist on a window seat with the additional rider of an adjacent empty seat. In fact she is prepared to go right to the back of the plane in order to claim that prize.
As a long-time traveler I have observed that everyone has their own preferences for airline seats.
Most of the time I don’t get a whole lot of choice, unless it’s an airline where I have status. So the choice can often be out of my hands, but flying Southwest provides a whole new area of choice optimization. Southwest does not assign seats, you simply take the first seat that you like the look of and claim it for yourself. Some other airlines in Europe also have this system.
This means that when I fly Southwest I engage in a game of chicken where I make my way slowly down the aisle eyeing up potential sites and quickly evaluate them against the row that I am currently on. My choice is between a seat in the current aisle or the promise of a potentially more favorable seat further down the plane. If I pull the trigger too soon then I might forgo the perfect seat in a few rows, or if I wait too long I may be left with some poor choices at the end of the plane.
The choice is not reversible and this creates a constraint on my strategy; when I have passed a vacant seat I can no longer return, I need to keep moving down the aisle pushed by the inexorable flow of passengers entering the aircraft. This is assuming I don’t flout social norms and clamber back over seats elbowing fellow passengers out the way in order to claim the perfect seat. I guess that could solve the problem, but flouting social conventions on a plane with strange, and, slightly aggressive, behavior usually doesn’t end well.
Optimal stopping problem
This is the perfect example of an Optimal Stopping Problem. The key problem we are trying to solve is – how many examples should I examine before I make a decision, in order to maximize my chance of choosing the best available option?
Other examples include how many potential partners you should date before settling down to marriage (or other committed partnership of your choosing), or how many apartments you should view before making a decision to rent? These are all examples of optimal stopping problems.
However travel seems to provide for numerous situations where a knowledge of optimal stopping could give me an edge. When walking through the terminal looking for a place to sit, do I choose the place near a power outlet but next to the kid having a tantrum, or proceed on to a potentially better place? (I guess if it’s my kid having the tantrum then I can’t really abdicate my parental responsibilities and have to settle for that seat!) When boarding a ferry do I hold out for a table somewhere that doesn’t smell of diesel, or take the best looking seat near the restaurant? These are all choices that I can somehow optimize to make the travel experience incrementally more enjoyable.
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You’ll be relieved to hear that those clever mathematicians have found a solution to this problem.
The optimal strategy is to monitor the first 37% of cases before making a decision. After that, you should choose the option that is better than any you have seen before.
A typical Southwest plane seats 137 passengers, so I need to walk past around 50 empty seats, or over eight rows, before I start to assess each new seat. At this point, I evaluate each new seat and if it is better than any of the 50 I passed by, then I take it there and then.
What’s the probability that my choice is optimal? It’s actually the same number of 37%! So I evaluate 37% of options before making a choice, and this strategy will give me a 37% chance that I get the best option for me. It’s not a great probability but it has been proven to be the optimal strategy. There is no better strategy.
You can thank math for that, and the math can get pretty hairy – see below!
There are different versions of the problem. For example there are variants where you can go backwards and select a previously rejected case. For these problems the optimal strategy involves looking at a larger sample before deciding, but the principle is the same.
As I get older I try to do new activities, experience new places, sample new dishes and meet new people. There seems to be a generally accepted fact that in order to keep feeling young I need to keep pushing myself out of my comfort zone. I also think the FI community promotes the view that financial independence will facilitate all these new and wonderful activities, allowing a life rich with continual excitement.
But optimal stopping theory tells me the opposite.
I’m now at a point in my life where I have probably met over 37% of the people I ever will, have been to over 37% of the places I’m likely to go, and sampled over 37% of the dishes I will ever taste. Optimal stopping theory says that my optimal lifestyle is potentially very close, and maybe only a couple of choices away.
Suppose you leave a comment below and I decide I like you. I mean really like you – more than all the other people that I’ve ever met. Then that’s it. I’m done. We are besties for life! There is no point in me trying to meet others, we will be friends for life!
This also works with food. I like to take the family to the Italian restaurant down the street, and my kids bitterly complain that I’m a curmudgeon and moan “we always go there”. This should not worry me, it is probably the optimal choice and the chance of improving on this familiar option is now getting vanishingly small. Why bother trying a new restaurant when it’s getting less and less likely that I will stumble upon a more optimal choice of great food, reasonable price, walkability and cold beer?
So… I finally have the mathematical justification to enjoy a financially independent, but curmudgeonly, early retirement.
Did you find this a useful tool to prevent analysis paralysis from making a decision? Let me know if you think you might use this in your everyday life. Also let me know if you’re happy being a curmudgeon and settled on your optimal outcome.
Technical note: the ratio 37% is not an accident. It is actually the ratio 1/e. The irrational number e pops up in all sorts of places, but it’s kind of surprising that it is here.