The Ostrich Effect: When Users Just Don’t Wanna Know

Why users avoid uncomfortable info, and what smart product design can do about it, especially in fintech.

Ever ignored your bank balance after a vacation?
Yeah... same. That’s exactly what we’re talking about today.

I love fish and aquariums hehe

I just got back from a trip, and I didn’t want to check my bank account

Not because I didn’t know I had spent money. Oh, I knew. But I didn’t want to face it. I wasn’t ready for the reality check.

That, my friends, is what psychologists call the Ostrich Effect. And today’s newsletter is all about how it shows up in UX, and especially in fintech products.

---

The Basics: Ostrich Effect

You’ve probably heard the phrase “ignorance is bliss.”
Thanks, Thomas Gray, for putting avoidance in poetic terms. This phrase sums up the Ostrich Effect pretty well.

When we intentionally look away from uncomfortable information. Like pretending your credit card bill doesn’t exist. Or avoiding lab results. Or not opening your budgeting app after vacation (guilty).

It gets its name from the myth that ostriches bury their heads in the sand when they’re scared, which, fun fact, they don’t.

The term itself was coined by two Israeli economists, Dan Galai and Orly Sade, in 2006.

Source

Dan and Orly noticed something fascinating. During market downturns, investors would check their portfolios less. Not because they were too busy. But because they just… didn’t want to know.

Why Do We Go Ostrich?

It is not laziness or carelessness.

The Ostrich effect is our brain’s way of protecting us from stress and psychological discomfort. If we think the news is going to be bad, we’d rather just not know.

Whether it’s a medical result, a scary number in our bank account, or a drop in our investments, sometimes, not looking feels safer than facing the truth.

But here’s the catch. It feels protective in the moment, yet it often leads to worse outcomes. Especially with things like money, health, or any of the other grown-up responsibilities we lowkey want to escape from.

---

How Does it Show Up in UX?

Gentle Micro-Copy

For instance, a while ago, I felt really motivated and had booked a pack of workout sessions. But of course... life happened. And I canceled a bunch of classes out of pure laziness

So what does the studio do?

They don’t send me an email saying, “Your sessions are expiring soon, don’t waste your money!”

Instead, I get this in my inbox:

This is the Ostrich Effect at play, but cleverly used.

Instead of confronting me with loss or failure, they invite me to re-engage without shame.

They protect me from discomfort while gently guiding me back in. And you know what? It works.

I was back in the studio next week.

When Apps Turn Your Money Into Fairy Dust

Ever notice how games and shopping apps never say “$4.99” anymore?

Nope. It’s always 500 gems, 1,200 coins, or shiny purple stars.

Pretending your in-app purchases don’t add up. Source: Lep’s World

Source: Subway Surfers’

It is very strategic on their part. Spending $4.99 feels like you’re actually losing money. But spending 500 gems… That just feels ✨fun✨.

---

What Can Finance Apps Do About the Ostrich Effect?

1. I Wish It Started With a Win

When I opened my finance app after vacation, I was dreading it.

But a little positive reinforcement goes a long way. If it had started with

“You saved €25 last month”

I might’ve felt better. But nope, straight to “You’re over budget.”

If apps led with a win, even small ones, they would feel more welcoming to users.

2. I Wish It Didn’t Hit Me With Everything at Once

“You’re over budget in 4 categories.”

Cool, cool, cool, love that for me.

I prefer something like:

“You went €172 over on eating out. Want to adjust next month’s limit?”

That’s digestible. It feels fixable.

It feels like a nudge I can act on.

3. I Wish It Celebrated the Bare Minimum

I opened the app. That alone deserves a little applause, okay? hahah

If my fitness app can throw confetti for just buying credits, why can’t my budget app hype me up for checking my balance?

It doesn’t need to be over the top, just something that says,

“Hey, I see you trying.”

That little boost could be the thing that keeps me coming back instead of avoiding it all over again.

I’m not saying finance apps need to hold my hand. But let’s be real, life can feel overwhelming enough as it is.

So when I open a budgeting app, I’d love if it didn’t immediately hit me with all the things I’ve done wrong.

Takeaways

• The Ostrich Effect is when we avoid things that feel uncomfortable, like checking your bank account after a vacation.

• It’s not laziness. It’s our brain trying to protect us from stress. But avoiding stuff usually makes things worse.

• Some apps use this on purpose, like hiding prices behind coins or sending soft, cheerful emails instead of reminders that feel harsh.

Your 5-minute task for today:

Pick one thing you’ve made, be it a design, an email, or your newsletter.

Now ask yourself, If someone’s already stressed about this topic, would this make them engage… or avoid it?

If it feels too heavy, try making it clearer, kinder, or a bit more encouraging.

---

🌠 Thank you for reading this newsletter.

See you next week,

Irene