Best Case Worst Case Analysis

When facing an important decision, the natural instinct is to try to predict what will happen. Will this job work out? Will this investment pay off? Will this relationship succeed? But prediction is notoriously unreliable. A better approach is to prepare for multiple possibilities.

What Is Scenario Analysis?

Scenario analysis is a structured way to think about decisions under uncertainty. Instead of asking “What will happen?” you ask “What could happen?” and prepare for each possibility.

The method originated in military strategy and corporate planning, but it's equally valuable for personal decisions like career changes, major purchases, or life transitions.

The Three-Scenario Framework

The simplest and most practical version uses three scenarios:

1. Best Case

What happens if things go well? Not fantasy-level well, but realistically well. What does success look like? This scenario helps you identify what you're hoping for and whether the potential upside justifies the risk.

2. Most Likely Case

What will probably happen? Strip away both optimism and pessimism. Based on everything you know, what's the realistic outcome? This is your planning baseline.

3. Worst Case

What happens if things don't work out? Again, not catastrophe-level, but realistic worst case. Can you recover from this? Can you live with it? This is the crucial question that determines whether the decision is worth the risk.

How to Identify Each Scenario

For each scenario, ask yourself:

• What would have to happen for this scenario to occur?
• What would you do if this scenario unfolded?
• How would you feel in this scenario?
• What could you prepare now to handle this scenario better?

Be specific. Vague scenarios aren't useful. “It could go badly” isn't helpful. “I could run out of savings in 8 months and need to find a new job” is actionable.

Common Mistakes to Avoid

Being Too Extreme

Best case isn't winning the lottery. Worst case isn't death. Keep scenarios within the realm of probability. Extreme scenarios lead to either reckless optimism or paralyzing fear.

Ignoring the Most Likely Case

We tend to focus on extremes. But the most likely outcome is what you should plan around. If you're not okay with the most likely case, the decision probably isn't right for you.

Not Preparing for Worst Case

Acknowledging worst case isn't pessimism, it's prudence. If you can't live with the worst case, don't take the risk. If you can prepare to make worst case more survivable, do so.

When This Method Works Best

Scenario analysis is most valuable for:

• Career decisions: Job changes, starting a business, going freelance
• Life transitions: Moving cities, major relationships, life changes
• Major purchases: Houses, cars, significant investments of time or money
• Any decision with uncertain outcomes where the stakes matter

It's not designed for financial investment advice, medical decisions, or anything requiring professional expertise.

Ready to think through a decision? Try our Scenario Planner to map out your best, likely, and worst case scenarios with AI-powered insights. Or first take the Intuition Test to understand your decision-making patterns.