If perception is reality then it occurs to me that the difference between a bad decision and a good one isn't so much the choice that's made but the resulting outcome of having made the choice. Think about it for a second. If you jump out of the way of a speeding car, you've made a smart choice even in the eyes of an outside observer. If, however, you land in front of a car speeding in the opposite direction, you've made a bad choice.

Your choice was the same either way. You jumped out of the way of a speeding car. But the results dictate the apparent intelligence of the decision you made. If that's the case, then we're all subject to fate when it comes to measuring the virtue of our choices. But there's another way of looking at things.

A very intelligent man once explained to me that the virtue of a decision can't be judged on the simplicity of the decision itself but has to take all variables into consideration. Don't worry, I had the same deer-in-the-headlights look you may have right now when he said it to me. But he went on to clarify things.

He asked if I would be enticed by an offer that could earn me $50,000.00 in ten years for a meager upfront investment of only $5,000.00. The odds, he explained were only about 50% that I would hit that target and improved if I would be willing to accept a lesser return. I'd have much better odds of realizing $40K, for example. But regardless, the odds of my losing my initial investment were very small. Though I'd have to wait 10 years, I'd be virtually assured of getting at least my initial investment back. Was I interested? I was, but only if I had no other interests in mind for that $5K. My response wasn't enthusiastic.

"OK," he continued, "now what if I told you I might be able to make you $5 million dollars and all you'd have to invest is $5 for the purchase of a lottery ticket?" Well that, I thought, was a no-brainer. I'd hand over the $5 with hardly a thought.

In response, he smiled, shook his head and told me I'd just made the same bad decision thousands of lottery ticket purchasers make every day. In failing to consider odds of return on their investment, they make a bad decision simply for being impressed by the potential return on investment relative to the cost of buying in.

In considering the purchase of health insurance for your pet, you face a similar decision but the lines aren't quite as clear. That, of course, means that making the smart choice can be far more confusing. It requires research and sensible thinking.

The problem is that many of us approach the decision to buy pet health insurance with the same irrational thinking we might apply to purchasing a lottery ticket. We ask ourselves how we'll feel if our pet lives to a ripe old age, never needing an expensive procedure. How will we feel having thrown away all that money over the years for nothing?

Alternatively, we apply emotions to the choice. If we don't get health coverage for our pet, does that mean we don't love it? Are we wrong for assigning a dollar value to the health of our animal?

In both cases these are the wrong approaches and will not lead to a smart decision. Basing the choice on what-ifs is wholly unproductive. No matter how healthy your particular breed may be in general, you can't predict accidents such as poisons or car accidents.

The emotional approach is no better and, in fact, can blind you to important realities. All the love in the world won't change your financial position if you can't afford the monthly expense for pet insurance. I'd dearly love to buy controlling interest in Microsoft. That passion doesn't translate to the financial ability to do so. Nor does the lack of finances mean you love your pet any less.

In deciding whether or not veterinary insurance is the smart choice for your pet, take a rational approach. Look at the facts. Should an expensive procedure be unexpectedly required, could you cover the cost out of your savings? Remember it could cost you thousands of dollars. Obviously, if you make a lot of money and are good at maintaining savings for emergencies then there's probably no point in getting insurance.

Also consider your pet's age and general health. If it is young and healthy, non-problematic breed then perhaps the choice to purchase pet insurance can be delayed until later in your pet's life. Just remember the warning that emergencies can and do happen.

Before you invest in pet insurance, you should invest time into researching your particular breed and your financial circumstances. The peace of mind that comes with having health insurance for your pet is great but not if you can't afford other necessities as a result. Factor in your job stability, savings account and your ability to sock away additional money over the next few months (and be brutally honest about your spending habits as you perform this analysis.

After reviewing all the facts absent attempts at prognostication and absent pointlessly kicking yourself emotionally, you'll be able to make a smart decision. That means the right choice at the time regardless the unanticipated outcome down the road. A rationally grounded decision will leave you content with the knowledge that you did what was right at the time. Save the random, emotionally-based attempts at predicting the future for your trip to Vegas